In this era of COVID-19, many of us have been alerted to the fact that we could become suddenly ill and be unable to speak or act for ourselves. If you are an adult and you become incapacitated, who can speak for you on important issues such as healthcare and medical treatment? Similarly, who can act for you on things like paying bills, doing your banking, filing insurance, etc.? If an adult is incapacitated and cannot speak or act on his or her own behalf, that person can be in a very difficult position. Their loved ones may not be able to help them even if they desire to do so.
So how can we assure that a person or person is authorized to speak or act on our behalf? The answer lies in two types of Power of Attorney. These are as follows:
- Durable Power of Attorney (sometimes called a Financial Power of Attorney);
- Power of Attorney for Healthcare (also sometimes called a Designation of Healthcare Surrogate)
A Durable Power of Attorney allows you to appoint a person or persons who can act for you on business, personal and financial matters in the event of your incapacity. Without this document, if you become incapacitated, a court-ordered Guardianship will have to be established. Most people, lawyers and layman alike, agree that Guardianship is not a good thing. It is slow, expensive and often very frustrating. A Guardianship is a court-proceeding and it requires having a lawyer. On the other hand, establishing a Durable Power of Attorney is fairly simple and inexpensive.
A Power of Attorney for Healthcare allows you to appoint a person or persons who can make medical and healthcare decisions for you in the event of your incapacity. It is crucial that the instrument have the necessary HIPAA authorization and release language so that your representative may communicate with your physicians and healthcare providers.
An example may help dramatize the importance of these instruments. Take John, a 67-year old single man who has an adult daughter and son. John becomes seriously ill with COVID. A neighbor checks in on him and realizing his situation, calls 911. EMS takes John to the emergency room but before John can process any admission paperwork, he becomes unconscious and is totally incapacitated. John’s kids show up at the ER and want to speak to their father’s treating physician. Unfortunately, John does not have a Power of Attorney for Healthcare with HIPAA authorization language in it. Because John became ill so suddenly, he was not able to sign HIPAA authorization at the hospital. As a result, John’s physicians won’t release any information about John’s condition or his treatment.
Eventually, John is admitted to the hospital. He ends up staying there for three weeks. However, during those three weeks, John has bills to be paid and insurance to be filed. He asks his daughter to take care of these for him. Unfortunately, the bank won’t cooperate because John never gave his daughter a Durable Power of Attorney. Similarly, the insurance company won’t talk to the daughter because she has no authorization to act for John.
In this example, if John had established a Power of Attorney for Healthcare, he could have empowered his son and daughter to speak to the medical providers on his behalf. If John had established a Durable Power of Attorney, his children could have paid bills, spoken with his insurance carrier, and performed other important acts on John’s behalf.
The key to having each of these Powers of Attorney in place is to establish them before an illness sets in. These legal instruments require that you have the mental and cognitive capacity to sign them. Waiting until a debilitating illness strikes may prevent your loved ones from being able to assist you. Needless to say, if you are in the hospital on a ventilator due to COVID, you will not be able to execute these documents.
A Durable Power of Attorney and a Power of Attorney for Healthcare are important legal documents. They protect you and let your family or loved ones act on your behalf. In setting them up, you should consult an experienced estate planning attorney. You don’t want to risk not having protection because you tried to do it yourself.