A lot of people like to say “it will never happen to me,” but the reality is that incapacity does strike a significant percentage of people who reach an advanced age. This is something to take very seriously, and if you want to cover all of your bases you should prepare for the possibility pragmatically and intelligently.

The ubiquity of Alzheimer’s disease is something that many individuals are simply not aware of. According to the Alzheimer’s Association, 13% of people who reach the age of 65 have Alzheimer’s disease. As you get older the likelihood of contracting Alzheimer’s increases, and it is more prevalent among women. 16% of women who reach the age of 71 have Alzheimer’s. Among the oldest old, Alzheimer’s is very common, striking 43% of those 85 years of age and older.

Alzheimer’s disease causes dementia, and dementia sufferers can find it impossible to make sound medical and financial decisions. If you were to fall into such a condition without making any plans in advance a guardian could be appointed by the court to act in your behalf and you would subsequently become a ward of the state.

To avoid this you must take action and add an incapacity component to your overall estate plan. Most people execute a durable financial power of attorney and a durable power of attorney for health care to protect themselves. The ideal financial decision-maker may differ from the person you would like to see making medical decisions in your behalf. So, you can name two different respective attorneys-in-fact who will be empowered to make decisions for you should you become unable to do so for yourself.

If you do not have an incapacity plan in place at present, it would probably be a good idea to arrange for a consultation with your estate planning attorney sooner rather than later so that you can execute these important documents.

The Law Offices of Saul Kobrick, P.C. is a member of the American Academy of Estate Planning Attorneys.

A health care proxy or durable medical power of attorney is an advance health care directive that appoints an agent to act in your behalf should you become incapacitated and unable to make your own medical decisions. This along with a living will within which you state your health care preferences are two rudimentary components to most estate plans. However, there is a third piece to the puzzle that is also useful in response to the passing of the Health Insurance Portability and Accountability Act of 1996.

When you make a health insurance claim or go to a doctor or pharmacy the details are all kept on record, and due to the passage of the HIPAA this information is not to be released to anyone without your permission. The purpose of the act was to protect your right to privacy and confidentiality, but it has created some unintended consequences.

Each hospital institutes its own privacy policy that address rules set forth by the Health Insurance Portability and Accountability Act. The health care providers who treat patients in hospitals must abide by these rules. For this reason they sometimes refuse to divulge information about the condition of a patient to his or her family citing HIPAA regulations. There are even instances when the patient has executed a durable medical power of attorney and appointed an agent who is denied information about the patient’s condition.

Because of the way that some hospitals and health care providers choose to interpret the Health Insurance Portability and Accountability Act, many estate planning attorneys recommend the inclusion of a HIPAA release along with your advance health care directives. When the release can be shown the hospital has no pretext for withholding information from the proxy. In addition, some people may choose to include multiple family members on the HIPAA release so that they can all freely have engage in a useful dialogue with health care providers.

The Law Offices of Saul Kobrick, P.C. is a member of the American Academy of Estate Planning Attorneys.

Estate planning is just a portion of the practice of elder law, and as we live longer it is important to make comprehensive plans to address any eventuality. The realities of after-death planning are evident, involving the recording of wishes that will hold sway after you are no longer around to make individual, ongoing decisions. However, there may come a time when you are still alive but unable to make medical decisions and conduct your financial affairs, and preparing for this possibility is what incapacity planning is all about.

The medical side of incapacity planning is addressed through the execution of advance health care directives like living wills and medical powers of attorney or health care proxies. Living wills are documents that elucidate your medical preferences, commonly applied to issues of life support in situations involving irreversible terminal illnesses. Heath care proxies give the power to make medical decisions on your behalf to an individual of your choosing in the event of your incapacitation.

Incapacity planning with financial matters in mind is usually achieved through the execution of a durable power of attorney, or in some jurisdictions a springing durable power of attorney can be used. Unlike a standard power of attorney, the durable power of attorney remains in effect after the incapacitation of the principal. The springing durable power of attorney gives the agent or attorney-in-fact the right to act on behalf of the principal only in the event of his or her incapacitation. The potential problem with the springing variety is that the definition of incapacity can be brought into question by a financial institution and a legal challenge could ensue.

Clearly, there are a lot of things to consider when you are constructing your estate, and making provisions for the possibility of incapacitation is one of them. To learn more about the specifics of incapacity planning, please feel free to contact us at (800) 295-1917 to arrange for a free consultation.

The Law Offices of Saul Kobrick, P.C. is a member of the American Academy of Estate Planning Attorneys.

A Power of Attorney is a legal document that allows you to give someone else the ability to act on your behalf.

The most common example of this is the General Power of Attorney that enables your named agent to conduct negotiations and sign documents in real estate or business matters in your stead.

But in estate planning, the Power of Attorney takes on a very different role.

You can use Powers of Attorney to enable someone to speak on your behalf with regard to medical treatments, for example or to designate someone to pay your bills if you become incapacitated.

And this is where a Springing Power of Attorney can come in handy.

A General Power of Attorney is automatically revoked if you become mentally disabled. This ensures that someone does not suddenly have “free reign” if you suffer from a stroke or become otherwise incapacitated.

But if that were to happen, who would pay your bills? Who would handle your creditors? A Springing Power of Attorney grants these rights and only allows the POA to be effective if you suffer a disability.

So, as long as your mentally capable of handling your own affairs, the Power of Attorney lies dormant and the agent you’ve chosen has no authority at all. But should something happen to you and you’re no longer able to speak on your own behalf, a Springing Power of Attorney could ensure that your financial affairs continue to be handled appropriately.

To learn more about Powers of Attorney and planning for disability, contact our office today.

The Law Offices of Saul Kobrick, P.C. is a member of the American Academy of Estate Planning Attorneys.