There is one thing I always tell clients about their estate planning — it is nice to have a Will, but it is essential to have a Power of Attorney. Although I don't discourage having a Will, for many clients, its absence often makes little difference. Most married clients have everything in joint names, and their spouse is the beneficiary of their life insurance and IRAs. For a single individual, intestate law often serves as a decent Will substitute.

On the other hand, failure to name an agent under a Power of Attorney can have disastrous results. There is no easy alternative. If that happens, the only way someone can assist you is by going to Court and having you declared incapacitated — not a pleasant task. Once this happens, the Court will manage how your assets are held and applied. A Power of Attorney is so much easier, and you — not a Judge — decide what happens. Choose someone now rather than have someone appointed for you later.

"A Power of Attorney is so much easier — and you, not a Judge, decide what happens. Choose someone now rather than have someone appointed for you later."

Power of Attorney for Assets

Gives your Agent the ability to handle your finances if you cannot do so yourself — paying bills, managing accounts, handling real estate, and conducting Medicaid planning on your behalf.

Power of Attorney for Health Care

Permits your Agent to make medical decisions on your behalf if you are unable to do so. In Pennsylvania, this is often combined with a Living Will to enable your Agent to act on end-of-life issues.

What Makes a "Good" Power of Attorney?

In Pennsylvania, a Power of Attorney must be witnessed by two witnesses and notarized. You can only record an original — copies cannot be recorded, which would make it impossible to use for a Deed. Prepare at least three originals so you always have one available. If you have real estate in another state, make sure the requirements of that state are satisfied and that your real estate is specifically identified in the document.

Here are the critical elements every good Power of Attorney should include:

Gifting powers must be explicit. Pennsylvania law states that unless gifting is specifically addressed, it is limited. If you do not grant your spouse unlimited gifting, it could interfere with your ability to obtain Medicaid, which requires all assets to be re-titled in the healthy spouse's name.
Medicaid planning authority. If your children are your agents, you may wish to permit them to perform Medicaid planning on your behalf — transferring funds to a trust or carrying out planning that provides more flexibility in care.
Separate your Health Care and Asset agents. Let your Health Care Agent sign you into hospitals and long-term care facilities without binding your assets with their signature.
Include pension and benefits access. Permit your Agent to deal with your health care provider and the administrators of your pension and group benefits. Failure to include this provision could cost time and money when you are sick.
Be careful about dangerous powers. Things like changing beneficiaries and disclaiming assets can be misused. If you grant these powers — and many standard forms routinely do — make sure you understand how they can be used.
Add a binding arbitration prohibition. Nursing homes routinely want arbitration clauses added to their agreements to avoid jury trials. Consider a clause prohibiting your Agent from agreeing to this.
Set up online access now. Social Security and many federal agencies do not honor a Power of Attorney. Make sure to set up access to your Social Security account or obtain an ID.ME account while you can.

Choosing Your Health Care Surrogate

For the Health Care Power of Attorney, we use a document that follows Act 169 in Pennsylvania and appoints an Agent to act on your behalf for medical and end-of-life decisions. Most medical decisions are not clear-cut. We think the best approach is to choose your surrogate wisely and provide them with the latitude to weigh all the facts and decide what they believe you would have decided yourself.

Make sure your surrogate knows what you want. Don't be afraid to talk about these issues. Talking about them does not mean they will happen — just like doing a Will does not mean you will die any sooner.

LS
Leonard L. Shober, J.D., LL.M.
Founding Attorney · Shober & Rock, P.C.

Len graduated with honors from Temple University School of Law in 1986 and holds an LL.M. in Taxation. Before law school, he worked as a social worker and family counselor — a background that shapes his deeply human approach to elder law. He has served Bucks County families for over 40 years.