“I am the master of my fate: I am the captain of my soul.”
So wrote 19th Century poet William Ernest Henley, expressing a human desire that may be harder to attain in the 21st. Life expectancies have soared over the past 100 years. But, as we live longer, the risks increase that due to accident or illness we may someday need help in making everyday financial and health care decisions. It is a risk we all face.
In the event you are ever unable to make financial or medical decisions for yourself, who will decide for you? Will you remain the master of your fate?
There are legal tools that can help you ensure that you will always have as much control as possible over your financial affairs, your personal decisions, and your health care treatment no matter what may happen to you physically or mentally. The most important of these is the power of attorney.
With a power of attorney you give someone you trust the authority to act on your behalf, make decisions for you, and be your advocate in the event that you are unable to do these things for yourself. The person you authorize is called your “agent.”
Your power of attorney is so important that you should not rely on a simple or standard document. It should be carefully crafted to meet your individual situation, preferences and goals.
Your agent will only be able to act in ways that are authorized in the document. For example, if you want a family member to have access to your medical information in the event of a health care crisis, your power of attorney should grant that authority.
Many people want their family to be able to protect their assets from loss to health care costs in the event of a long term illness. If the document does not contain the proper language, you family may be at risk of financial devastation.
Here are some critical issues you should consider when you are preparing your power of attorney.
1. Asset Protection. Do you want to authorize your agent to protect your assets from health and long-term care costs? If so, your agent may need to transfer ownership of your assets to your spouse or children. This authority must be clearly stated in the document, or your agent may not have the ability protect your assets for your family. A standard power of attorney won’t include this power, so you may need to raise this issue with your lawyer.
2. Authorization of your Health Care Representative. A power of attorney can help ensure that you will always receive the types of medical treatment you desire, avoid unwanted procedures, limit your pain, and be treated with care, dignity and respect. To achieve these goals, your power of attorney can empower a trusted person to serve as health care agent to advocate for you. Your document can also provide some directions to your decision makers by expressing your values and philosophy about the health care treatment you want to receive, especially at the end of life.
Appointment of a health care agent with broad authority to act for you is particularly important because of the federal privacy regulations referred to as HIPAA. These federal rules may cause health care providers to deny your family access to your health information and participation in your care. The inclusion of appropriate language in your health care power of attorney will authorize your agent to get the information needed and make the best informed decisions on your behalf.
3. Avoiding Abuse. In the wrong hands, a power of attorney can be an instrument of financial abuse and exploitation. The danger of abuse is particularly acute when the document includes the authorization to make transfers of your assets. Your power of attorney needs to walk the fine line between your goal of protecting the financial security of your loved ones and ensuring that you will always be able to receive and pay for the care you need.
4. Naming Successor Agents. Just as you may someday be unable to make financial and health care decisions, there is always a possibility that the person you choose as your agent may become unavailable or unwilling to serve. Make sure you deal with this possibility by appointing a back-up agent.
Conclusion. A power of attorney may someday become your most important legal document. It may be of invaluable assistance to you and your family. But, an ill-considered power of attorney can lead to disaster. This is one document where you don’t want to cut corners. You and your family could someday pay a heavy price.