We say that the Power of Attorney may be the most important document that a person should have, trumping Wills, Trusts, and Living Wills. Without a comprehensive Power of Attorney, you will have no choice but to let a judge make your healthcare decisions on your loved ones’ behalf. And don’t believe the software salesman, Powers of Attorney are only “good” if they permit you to do the things you need to do to protect your loved ones.
Power of Attorney FAQ’s
How much does a Power of Attorney Cost? A Power of Attorney should not cost all that much. We are not permitted to quote prices but generally speaking the Power of Attorney should be priced so that everyone will have one. There should not be sticker shock for these documents so that you will run to a stationary store or software program instead of having one drafted by a competent elder law attorney. And I say elder law attorney because I believe that Powers of Attorney should be done with disability and long term care in mind which means that certain provisions are essential and some dangerous. Unless you draft and use these every day you may not be aware of these.
What is a Power of Attorney? Types of Power of attorney (limited, general, durable) There are basically two (2) general categories of Powers of Attorney – “Assets” and ““Health Care.” An Asset Power gives your agent the ability to handle your finances in the event that you cannot do so yourself. The Health Care power permits your agent to make medical decisions on your behalf. In Pennsylvania, this power may be combined with a Living Will to permit your agent to act on your behalf in end-of-life issues. Within these two categories there are subcategories such as durable, special, limited and general powers. Durable are powers that last beyond incapacity and therefore can be used if you become disabled. Special powers are those like the banks give you for a particular account. General are just that – a broad ranging power to do all things necessary to control and protect assets.
Can I combine my health care and asset Power of Attorney? A good idea for Powers of Attorney is to separate the holders of the Health Care and Asset Powers. Let your Healthcare agent sign you into hospitals and long term care facilities without binding your assets with their signature. Make sure that your agent can deal with your healthcare provider and with your pension and group benefits administrators. Failure to include this power in your document could cost time and money when you are sick. Social Security does not honor a Power of Attorney. Luckily, much of the work you may want to accomplish with your benefits can be done online.
What mistakes should I watch out for in a Power of Attorney? Be careful about “dangerous powers.” These are things like changing beneficiaries and disclaiming assets from an estate where you are a beneficiary. If you give these powers, and many forms routinely do so, make sure you understand how they can be used. An important element that should be added is regarding binding arbitration. Nursing homes routinely want this added to their agreements to avoid jury trials. You should consider a clause in your document that prohibits your agent from agreeing to this.
Can I get a Power of Attorney from Staples or Office Depot? Sure, you can get one but generally these vague and very general documents are not tailored for elderly clients and may only be good enough to hire a real attorney to draft a real document.
The Nursing Home is offering to do a Living will for me, is that OK? I would say to be careful about this. It is one of the most important documents you can have and one of the most important conversations you should have with your family and your doctor. Having a form thrown in front of you for the convenience of the nursing home is not the way this should be addressed.
Why do I need a Power of Attorney? 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. While I do not advocate not having a Will, in many cases not having one really does not change much for our clients. Most married clients have everything in joint names and their spouse is the beneficiary of their life insurance and IRAs. For single individuals intestate law will sometimes suffice as a Will substitute. I do not advocate this if you have younger children or children from a previous marriage or if you are single with no children but have an aging client.
The bank won’t honor my Power of Attorney, what can I do? The bank has to honor a POA presented to them unless they have knowledge that it is being used to the detriment of its depositor. They may request an Affidavit that the POA is in full force and effect and that the depositor is still alive and does not have a Guardian but that is all they can ask for. A lot of banks think that they can review the document and require originals and witnesses and notarizations and such but they can not. I letter from someone who knows the law will suffice to get them to act. In their defense, there have been a lot of abuse using POAs and banks are more than a little nervous about honoring them.
What is a good Power of Attorney? What makes a “good” Power of Attorney? Well, it should be executed correctly. In Pennsylvania, a Power of Attorney does not need to be witnessed or notarized to be effective. However, if you own real estate, you should have it notarized so it can be recorded. Also, you can only record an original Power of Attorney. Copies cannot be used to record a Deed. Therefore, you should do at least three (3) originals at the time you prepare your Power. If you have property in another state, make sure that the requirements for that state are satisfied in your power. Make sure that your properties are referenced specifically in the documents. Failure to properly identify your real estate could be a problem in some states.
Do I need a notary to witness a Power of Attorney? Not unless you cannot sign your own name.
Does a Power of Attorney permit me to make gifts to myself? Another important issue is gifts. Pennsylvania law states that unless you are specific about gifting, then gifting is limited. If you do not grant your spouse unlimited gifting, it could interfere with your ability to obtain medical assistance which requires that all assets are titled in the name of the healthy spouse. If your children are your agents, you may wish to permit them to perform medicaid planning on your behalf by transferring funds to a trust or to carry out planning that could provide you with more flexibility of care. You may want to indicate that your prior gifting and estate planning need not be followed in an emergency situation. Make absolutely sure that the name on your power matches the name on your Deeds. If the names don’t match, it may make the power ineffective for recording a Deed.
Can I access health care records with a Power of Attorney? Yes, you should be able to with a good Power of Attorney that waives HIPPA rules. And what about a good Power of Attorney for Health Care? We have been moving to a document that follows the law and simply names an agent to act on your behalf. Choose a good agent and you will not have to list every possible medical condition or illness that you may have in the future. Most medical decisions are not clear-cut. We think the best thing to do is choose your agent wisely and provide your agent with the latitude to weigh all of the facts and make a decision that your agent believes would be made by you if you had the power to do so. Make sure your agent knows what you want. Don’t be afraid to talk about these issues. Talking about them does not mean that they will happen. Just like doing a Will does not mean you will die any sooner.
Can I use a Power of Attorney for Social Security? Social Security will not honor a Power of Attorney and prefers that you name a Representative Payeee.
Can I use a Power of attorney for VA? VA has a separate form for naming an agent for a veteran.
Who can act as my agent under Power of Attorney? Generally any adult may act as an agent as well as banks and even car dealers. For Powers of Attorney for long term care needs, be very careful about naming someone you trust with all of your assets because they have all of the power of the assets that you have as principal. If you are still competent to handle your affairs, you can keep the POA in the file to be executed by the Agent at the time it is needed.
Contact Us Today!
The Elder Law Attorneys at Shober and Rock represent clients with a wide range of needs. Call (215) 345-4301 today to consult with our experienced Powers of Attorneys Lawyers.
