Estate Planning When Faced with a Serious Illness

More young and middle-aged workers find themselves in the role of family caregiver.
Everyone needs estate planning documents, but a serious illness makes that need more urgent. 

More than 130 million Americans are living with chronic illness. Forbes’ recent article, “Estate Planning Musts When You Or A Or A Loved One Has A Chronic Illness,” says that if you (or a loved one) are living with a chronic illness, you’ll likely need the same estate planning documents most people should have.

The article discusses these key estate planning documents, along with some suggestions that might help you customize them to your unique challenges because of chronic illness. These documents need to be tailored to your specific needs, so you should consult your estate planning and elder law attorney about what works best for you.  It’s also best to put your estate planning documents in place soon after your diagnosis, so that you can return your focus to your health, family and well-being.

HIPAA Release. The Health Insurance Portability and Accountability Act of 1996 governs the requirements for maintaining the confidentiality of protected or personal health information (PHI). A HIPAA Release lets someone you trust access your protected health information.  This is an important estate planning document because it provides your decision makers with information about your condition so they can best serve your needs.

Living Will. This is a statement of your health care wishes and can address end of life decisions, as well as many other matters. If you’re living with a chronic illness, there are special considerations you might want to make in having a living will prepared. For example, you might explain your specific disease while continuing to address other health issues.  You can address the disease you have, at what stage and with what anticipated disease course, and how if at all these matters should be reflected. It is also critically important to discuss these wishes with your loved ones before the issue arises so they understand what you want.

Medical Power of Attorney. This is sometimes known as a medical proxy. It is an estate planning document in which you designate a trusted person to make medical decisions for you if you’re unable to do so. You can give guidance to your medical agent about your preferences, goals and concerns in your medical care.

Financial Power of Attorney. This estate planning document lets you designate a trusted person to handle your legal, tax, and financial matters if you can’t or if it becomes difficult to do so. There are some unique considerations for those living with chronic illnesses to consider. One is the amount of control that should be given up now or at what stage. Another key issue in a power of attorney is if you should sign a special power that restricts the agent’s authority to certain specified items or sign a general power that provides broad and almost unlimited powers to the agent.  It is especially importantly that your power of attorney include authority to handle Medicaid and other long term care benefits if you are facing a serious illness.

Appointment for the Disposition of Remains.  This is a basic estate planning document by which you choose a person to execute your burial wishes and let them know what those wishes are.

Declaration of Guardians.  This is an estate planning document in which you name a person to serve as a court appointed guardian should you need one.  If you have the other documents in place you’ll likely never need this, but it is important to have as a safety net naming someone you trust to be guardian instead of a court appointed agency or lawyer if the need ever arises.

Will and Revocable Trust. Finally, Wills and  Revocable Trusts are estate planning documents which control the flow of assets at your passing.  You should speak with your attorney about which is right for you, but if you or a family member has a chronic illness, using a revocable trust may be a good way to provide for succession of your financial management.  A revocable trust allows the successor trustee to act quickly to manage the finances if you cannot do so yourself and under the guidelines you create.  This way, the trustee can pay for the care you need.

Everyone should have these estate planning documents as part of a well-crafted legacy plan, but if you or a loved one is facing a serious or chronic illness, you may be facing additional challenges that make this planning more critical.

Reference: Forbes (July 5, 2019) “Estate Planning Musts When You Or A Or A Loved One Has A Chronic Illness”

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When You Need an Elder Law Attorney

An elder law attorney can guide you through the issues that affect us as we age.
An elder law attorney can guide you through the issues that affect us as we age.

The conversation that you have with an estate planning attorney, when you are in your thirties with a new house, young children, and many years ahead of you is different from the one you’ll have when you are much older. That’s the time to consult an elder law attorney. When you are older, you face a whole new set of issues, including rising health costs and the possibility of needing long term care. An elder law attorney knows that you are about to enter a time in your life when your estate planning documents are more likely to be used, says the article “Learn about legal documents and Medicaid” from the Houston Chronicle.

As we get older, the need to address long term care becomes more important. Elder law attorneys warn that there are many options that may be foreclosed if planning is not done ahead of the time. This is the time to talk to an elder law attorney to create a road map that anticipates the care you may require as you get older and how to pay for it. Making the right decisions now, could have a big impact on the quality of your life in the future.

This is also the time to update your financial and medical powers of attorney. Because of your experiences, there may be certain preferences you have for health care treatment. In addition, your elder law attorney may advise you to include a broad gifting power in your financial power of attorney which may be necessary to help you qualify for government assistance.

You should also review your other estate planning documents to make sure that they still reflect how you wish your estate to pass at your death. Your elder law attorney may suggest adding provisions to protect a surviving spouse’s eligibility for Medicaid or other government assistance in case it is needed.

It may be that your estate plan will include trusts, or that certain assets will need to be retitled. An elder law attorney can guide you through this stage of your life to make sure that you are prepared for what the future holds.

Learn more about elder law and medicaid at our website.

Reference: The Houston Chronicle (April 19, 2019) “Learn about legal documents and Medicaid”

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Living Wills and Medical Powers of Attorney – Why They Are Important

Medical Power of Attorney agent discussed health care decisions with family member
It is important to discuss medical preferences with your medical power of attorney agent.

Living Wills (referred to in Texas as “Directives to Physicians and Family Members”) and Medical Powers of Attorney are important if a person becomes incapacitated, whether that status is permanent or temporary. These are part of a comprehensive estate plan, and you’ll want to take care of this before a medical emergency arises. That’s the recommendation from the McPherson Sentinel article “Advance health care directives important to all adults.”

Documenting your wishes about future health care lets a cognitively healthy person express his or her wishes with a clear perspective. Unfortunately, only one in four American adults has their medical power of attorney and/or living will in place. Many wait to begin the planning process until they are in their 50s or 60s. The problem is, life doesn’t have a plan. Tragedy can strike at any time in life. A serious illness or an accident can occur leaving the family wondering what the person would have wanted.

You do not need to be in an “end of life” situation for a medical power of attorney to come into play. The agent you name in your medical power of attorney makes a health care decision for you any time you cannot communicate your wishes, yourself. This could happen during a routine medical procedure that is not life threatening.

The living will, on the other hand, sets out your wishes in the event you have a terminal condition, death is imminent, and you do no want your life to be prolonged by artificial means. Artificial means may include, among other things,  being placed on a ventilator or receiving artificial nutrition and hydration.

Under Texas law, your agent under a medical power of attorney may make the decision to withhold or withdraw life support, unless you have limited that power in the document. That is why a living will or a directive to physicians may not be legally necessary, if you have named an agent in a medical power of attorney. But many people opt to have a living will in addition to a medical power of attorney. They would like to give their own instructions for end of life decisions as opposed to putting the burden on the agent named in the medical power of attorney.

One thing to keep in mind is that a medical power of attorney is different from a financial durable power of attorney (in Texas – the Statutory Durable Power of Attorney), which gives a person the right to act as another person’s agent and conduct business and financial matters on his or her behalf.

It’s very important that the people you designate as agents in a medical power of attorney or living will are told that they have been named. You should designate an initial agent and then one or more successor agents in case the first person named is unable to act. Your agents need to fully understand what your wishes are and what kinds of treatments are acceptable to you. Communication is the key and you need to make sure that you and your agent have discussed your preferences.

The people you select as agents under your medical power of attorney should also understand that health care decisions for you need to be made according to your wishes and not their wishes or the wishes of other family members.

These documents should be prepared for you as part of your overall estate plan, with the guidance of an estate planning attorney. Be aware that the laws vary from state to state, so you’ll want to work with an attorney who knows your state’s laws. If you relocate to another state, you should update your medical power of attorney and living will to conform with that state’s laws.

Finally, make sure that your medical power of attorney and living will are located in a place where they can be easily found in an emergency.  Your agents should each have a copy they can bring to the hospital, if necessary. The important thing is that the medical power of attorney and living will can be found and used in a time of crisis.

Reference: McPherson Sentinel (April 17, 2019) “Advance health care directives important to all adults”

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