Legal Planning For Illness & Aging

As we age, we start to worry about a whole new set of issues.  What will happen if we should get sick or become disabled?   Who will manage our property and pay our bills if we are hospitalized for a period of time?  Who will make medical decisions if we are too ill to do so ourselves?  How do we leave that pretty little red Mustang convertible we rebuilt to grandson Bobby after we die (and not a minute sooner)?

Legal planning can help you to prepare for possible illness or disability and to create an estate plan that will pay your debts after you die and leave your remaining assets to the individuals you wish to have them.

Legal planning generally requires the assistance of an attorney (also called a lawyer).    In the U.S., to qualify as an attorney, a candidate typically must receive a bachelor’s degree from a college, then complete another three years of full-time graduate training at an accredited law school, and then must pass the bar exam in his or her state and be admitted to practice law in that state.  New lawyers then generally put in long hours of “on-the-job training” as young associates working for more experienced attorneys.

As today’s doctors tend to specialize, so do today’s attorneys.  Some are trial lawyers (litigators), others specialize in real estate matters, or oil and gas law, etc. 
The types of attorneys who spend a significant portion of their practice assisting older adults and their families include attorneys who focus on elder law, estate planning, probate administration and Social Security.

Elder law attorneys work with older adults, and/or their families, on legal issues related to health care and finances (powers of attorney and advance directives), insurance and benefits (Medicare and Medicaid), planning for the disposition of property after death (Wills and Trusts), the appointment of surrogate decision-makers for incapacitated individuals (guardianship/conservatorship) and in handling the estates of someone who has died (probate administration).  Estate planning attorneys tend to focus on Wills and Trusts, particularly in larger and more complex estates, and the administration of estates after someone dies (including Will challenges).  Both types of attorneys work in the general area of law titled “probate”.  Some attorneys focus more narrowly on Social Security applications, claims and appeals. 

What types of assistance can these specialized attorneys provide for you? (Learn more about all the topics listed below by taking our “Legal Planning for Illness and Aging", "Guardianship", "Paying for Long-Term Care", "Government Programs 1 & 2" and "Death and Beyond" classes from the comfort of your own home.  See our Classes/Videos section.)

1. Health Care Power of Attorney.  A power of attorney is a legal document in which the principal (the person who creates the power of attorney) grants another trusted individual (and one or more back-ups) the authority to manage the principal’s health care.  The document allows the principal to name an individual (called the attorney-in-fact or agent) who can make medical decisions for the principal IF the principal is unable to make or communicate those medical decisions on his own.  A health care power of attorney may also include advance directives in the document (these types of legal documents can be drafted in different formats) or may be combined with a separate document, sometimes called an Advance Directive to Physicians (what we used to call a “living will”).  The health care power of attorney itself names a trusted agent who is empowered to make medical decisions when the principal cannot.  The advance directive defines the type of care the principal would or would not want -– sometimes these care guidelines are very general, but they can be very detailed.  At a minimum, advance directives should discuss whether a principal would want cardiopulmonary resuscitation (CPR), a ventilator or respirator, or a feeding tube, and under what circumstances, if the principal were gravely ill or severely injured.
2. Financial Power of Attorney.  Like the health care power of attorney, a financial power of attorney (often called a durable power of attorney because it generally remains in effect until revoked by the principal or until the principal dies) allows the principal to name a trusted individual (and one or more back-ups) to manage financial matters for the principal, and only for the benefit of the principal.  The financial powers granted may be quite limited or very broad.  Some powers of attorney are effective when the principal signs them; others go into effect only when specific stated criteria are met.  The principal gives up no rights to manage her own financial affairs, but she may now share the ability to make financial decisions and manage assets.   An agent (also called an attorney-in-fact) using a power of attorney does not own any of the principal’s assets, but may manage those assets for the benefit of the principal.   The advantage of a financial power of attorney is that it permits continued management of finances and assets if the principal becomes ill and needs assistance, without endangering the ownership of the assets (unlike joint bank accounts, which share ownership).  It is vital, however, that a principal choose her agents very carefully because a financial power of attorney can make it simple for an unscrupulous agent to steal assets from the principal.  This type of theft, fraud or embezzlement is subject to both civil liabilities and criminal prosecution, but neither remedy is of much comfort to a trusting principal who has been robbed. 
3. Appointment of Agent to Control Disposition of Remains.  E-Senior Services is based in Texas.  Our state offers an unusual variation on a power of attorney titled the “Appointment of Agent to Control Disposition of Remains.”  This is the only power of attorney whose powers survive the agent learning of the death of the principal.  This power of attorney is designed to permit a principal to state who will control his body after death (and who will make decisions regarding burial vs. cremation, where to bury the remains and all other funeral arrangements).
4. Will.  After an individual dies, her debts must be paid and her remaining property distributed.  An individual creates a Will prior to death and states who will be in charge of her property after she dies (the remaining property is called the Estate and the person in charge is the Executor or Personal Representative).  The Executor uses estate assets to pay the debts of the deceased individual (who is called the Decedent) and then distributes the remaining assets to the persons named in the Will (who are call the Beneficiaries or Devisees).  Whether or not you create a Will before death, someone will still have to manage your estate after you die.  If you don’t leave a Will, someone must volunteer to manage the Estate (and may have to be confirmed by a Court, depending on the size of your Estate) and, after payment of debts, he or she will distribute your remaining assets to your next of kin as defined by the state in which you resided at the time of your death (regardless of whether those are the choices you would have made).  
5. Trust:   Some individuals choose to create a Trust (a fictional entity that can hold title to the individual’s assets) prior to death.  While not everyone needs a Trust, trusts can have some advantages in financial management and lessening estate taxes after death, especially for large estates.  An individual’s trust can own the individual’s property.  While the individual may die, the trust does not.  Therefore, after the individual dies, the trust can continue to pay debts and can then distribute trust assets to the beneficiaries designated in the trust, avoiding much or all of the probate process.  A trust can also help with financial management during an individual’s lifetime.
6. Probate of an Estate:  As mentioned above, when someone dies, his Executor or Personal Representative must locate all the Decedent’s assets, pay the Decedent’s valid debts and then distribute the remaining assets according to the terms of the Decedent’s Will or Trust (if none, then according to state law).  This process is called the administration of a probate estate.  There are certain legalities that must be observed and, in estates of any significant size, the Personal Representative or Executor may need to be appointed by a Court that will oversee the administration of the estate.  An attorney must represent the Executor or Personal Representative before the court.
7. Medicare.  Individuals who have applied and qualified for Medicare may have occasional disputes with Medicare, either about their eligibility for the program or about specific claims.  An attorney can assist an individual to file claims or appeals on Medicare issues.
8. Medicaid.  The Medicaid program may assist qualified individuals to pay for long-term care, such as care in a nursing home.  The individual must be eligible for benefits, must need the physical care and must qualify financially under the program.  The rules are quite complex and differ a little from state to state, and sometimes even from county to county.  Elder law attorneys can advise clients of their rights under Medicaid and can assist them to file applications and appeals in the Medicaid system.
9. Social Security:  Some individuals are denied Social Security when they first apply or feel that their benefits have been calculated improperly.  Disabled individuals may be eligible for Social Security before reaching retirement age, but must prove their disability to the Social Security Administration.  Attorneys who specialize in Social Security issues represent clients in these types of claims and appeals.
10. Guardianships and conservatorships.   If an individual becomes incapacitated (severely impaired physically or cognitively) and cannot make rational medical decisions for himself, cannot care for himself, and/or cannot manage his finances and assets, and when no valid health care and/or financial powers of attorney are in place (or the impaired individual will not work with the agents he appointed earlier, or the family disputes the validity of the powers of attorney), then it is sometimes necessary for the court to appoint a guardian/conservator to protect and care for the individual and to manage his finances.  States differ in their use of this terminology.  Some speak of a guardian of the person (power over the individual’s medical care, residence and sometimes physical custody of the person) and guardian of the estate (power over the individual’s finances and assets).  Other states use the terms conservator of the person or the estate, with similar meanings as above, and some use guardian to mean care over the person and conservator to mean management of the estate.   Regardless of the terminology, this is a last-resort legal process designed to protect an impaired individual and to ensure he receives appropriate care and that his finances are handled properly for his benefit.  A guardian or conservator is appointed only after a concerned individual, or the state itself, files a guardianship/conservatorship action with the proper local court, notice is given to the individual and known family, a hearing is held and evidence and testimony presented, and the judge renders a decision on whether the individual is incapacitated, to what extent, whether a guardian/conservator is appropriate and, if so, whom that should be.   This is an adversarial legal process that can be painful for the impaired individual, damaging to family relationships and expensive to boot.  Unfortunately, it is sometimes the only remedy to ensure that an incapacitated individual receives proper care and protection, especially when the individual planned inadequately for potential illness or disability.

WARNING:  Please do not interpret any of our web site’s text as legal advice.  Our text is only here to provide some basic educational material that may help you identify topics of interest to you.  Each person’s situation is unique and no one legal solution fits everyone.

BEWARE OF LEGAL FORMS IN KITS, BOOKS OR ON THE INTERNET.  There are great medical web sites that can teach you a lot about your heart.  They won’t qualify you to perform open-heart surgery.  It is best to leave that to an experienced and skilled surgeon. 

Similarly, filling in the blanks in a form Power of Attorney or Will looks easy, but if you don’t fully understand the options you have, and the consequences of your choices, and if you don’t execute the document according to the requirements of your state, you may create a legal document that doesn’t do what you intended, or worse, one that is simply invalid, or even nonsensical, as written.  Consult an attorney rather than trying to create these documents at home on your own. Talk to an experienced attorney who practices in your area of need, learn about these legal planning tools, explore your options and make wise choices based on your conversations, then leave the drafting of legal documents to the experts.  It is generally less expensive to do something right the first time around than to try to fix it later.