February is National Wise Health Consumer Month and in an effort to help our community better prepare for whatever tomorrow might bring, we are dedicating this blog to explaining a simple but critical part of every older adult’s long term planning: Power of Attorney (POA).
A Power of Attorney is a legal document where an individual “the principle” grants another person or organization “the agent” to make medical or financial decisions for the principle if they become unable to do so for themselves.
A POA only goes into effect if the principle becomes cognitively unable to make decisions for themselves, with the ability of the principle to cancel a POA or designate a new agent at any point.
Why is a POA Helpful?
A POA arrangement is helpful because there might be a point in the future where a sudden medical emergency can prevent you from making important choices. By having a trusted family member or friend who understands your wishes assigned as your POA, you can ensure decisions are made in a timely manner and to your liking.
While a family member can step in following a debilitating medical emergency to help manage your affairs without a POA, obtaining guardianship can be a lengthy and expensive legal process and have an impact on whether you receive the treatment you want.
How to Establish a Power of Attorney
Setting up a Power of Attorney is reasonably simple, fast and inexpensive. Both parties discuss the arrangement and expectations and fill out a state-specific form outlining the agent’s responsibilities and what types of medical or financial decisions they can make for the principle. Once completed, a Power of Attorney form must be notarized in order to become active.
Two Types of POAs
There are two broad categories of POAs, medical and financial, and the broadness or specificity of the terms are completely determined by the principle and the agent. Responsibilities between the two types of POA can also be delegated to different people, i.e. one relative can act as a medical POA while another manages your finances.
Medical: Medical POAs cover any decisions related to the principle’s health care, and can include guidelines on different acceptable medical procedures, residential arrangements, hospice care and other important topics. When determining an agent, it is critical that they fully understand the principle’s wishes and make sure to keep the conversation ongoing as the principle’s needs and wishes change.
Financial: Financial POAs grant an agent the ability to perform specific financial tasks on the principle’s behalf, but these powers are narrowly defined by the arrangement. As a result, different financial activities like the management of a business, benefits, estates, the sale of stocks and other actions must be specified in the document, and these responsibilities can be divided amongst multiple people. It should be noted that while a financial POA does grant the agent the power to perform financial actions, all assets remain the property of the principle.
Building an open, honest Power of Attorney relationship with a friend, family member or loved one can be one of the most important long-term healthcare and financial decisions an older adult makes, and the process of defining your wishes in a POA can be a great way to determine what matters most in your life. While it is not always a requirement, it is strongly suggested that interested individuals seek the help of an eldercare attorney or similar expert to help guide both parties through the POA process.
SelectCare hopes you found this article useful. Our team of home health care experts has more than 30 years of experience helping New Yorkers live happier, healthier lives in their longtime homes, providing the support they need to focus on what’s truly important in their lives. To learn more about SelectCare and how we help our clients overcome challenges great and small, call us today or request a free in-home care guide.