A comprehensive estate plan is important, but it may not be enough. Have your parents thought about what happens if they’re incapacitated? If something happened to them so that they couldn’t speak or act for themselves, what happens?
Incapacity planning addresses how decisions get made if an accident, injury, or medical issue makes it impossible to act on one’s own. This form of planning addresses who would make financial and medical decisions if you can’t do it on your own.
Incapacity Planning for Finances
Stroke and dementia are leading reasons that your parents cannot overlook incapacity planning. They could find themselves with little cognitive function and unable to express their wishes. If that happens, they need to have a plan in place to ensure their needs are met and their wishes followed.
Powers of attorney for financial matters place an agent to help pay bills and manage finances for a person who is incapacitated temporarily or permanently. A POA allows the designated person to sell off items, make decisions for insurance coverage, and pay bills.
Set up a revocable living trust should be considered in addition to a financial POA. It allows the grantor’s agent to manage the grantor’s assets until his or her death. At that point, they’d be handed to the beneficiaries.
A will should also be in place to make sure your parent’s assets go to the right person. Without a will, assets could go to a spouse before a divorce is finalized. It could go to a child that walked away from the family. It could get contested by aunts, uncles, or cousins.
Incapacity Planning for Medical Matters
If your mom or dad cannot speak for themselves due to a cognitive decline, sudden illness, or accident, they can have a person act on their behalf. To make sure their wishes are met, they need these four protective measures.
Advance Directive – Covers what your parents do and do not want in terms of end-of-life care measures like pain management, feeding tubes, and ventilators.
Health Care Proxy/POA – Gives a person called an agent permission to make the grantor’s (person who is giving the agent permission) medical decisions on his or her behalf.
HIPAA Authorization – Gives medical professionals permission to discuss medical tests and records with the designated person/people.
Physician Orders for Life-Sustaining Treatment – Your parents should fill out the POLST documents with their doctor. This is used in the medical field to know if there is a DNR order in place and what treatments are allowed to be given to sustain life or provide end-of-life care.
Your parents should talk to an attorney about their estate planning needs. They also want to ask about incapacity planning to protect themselves in case of unexpected health issues. An elder law attorney can help them with legal documents like advance directives, powers of attorney, and wills.
If you or a loved need assistance with Elder Law in Vestavia, AL contact Nolan Elder Law & Estate Planning today. (205) 390-0101