In your estate plan, if you are like most people, you want to make sure that you are in control while you are alive and well, that you and your loved ones are provided for when you are not so well and when your gone, give what you have to whom you want, the way you want, when you want.
Your health plays a huge role in the type of planning that you can do or that your loved ones can do for you. You have worked hard all your life to get what you have. Do you want to protect those assets for you and your loved ones?
I had an attendee at an estate planning workshop this week ask what would happen if she couldn’t make decisions for herself because she became decapitated. I said if that happened, she would be having a pretty bad day. However, if she were alive and well and of sound mind today, she could prepare documents to provide for her care during her incapacity.
If you became mentally incapacitated, the only persons that can make decisions for you are either the persons whom you choose or someone whom the court chooses. If you do not have proper health care and financial powers of attorney in place, the probate court gets involved.
A guardian would have to be appointed to make decisions over you, such as where you are gong to live or what type of care you are to receive. A conservator would have to be appointed to take care of your property and financial affairs.
You may think the because you are married, you spouse automatically can make these decisions for you during your incapacity. Not so. You have to appoint your spouse in properly executed health care and financial powers of attorney, or then the court does.
When you are alive and not so well, you may want to make sure that your instructions are going to be followed, that you are in an appropriate residential setting and your healthcare and other needs are covered. You may also want to make sure that your stuff is distributed properly after you are gone.
At a minimum, everyone should have a will, a health care power of attorney and a financial power of attorney. Your health care and financial powers of attorney will prevent the necessity of going into court for the appointment of a guardian or conservator upon your incapacity.
You may have estate planning documents that are triggered upon your incapacity in the opinion of medical professionals or loved ones. Upon that determination of your incapacity, you can convey a number of powers to your health care and financial agents in order to take care of you and your stuff. If you are already mentally incapacitated or what some people call old and funny, and have done no planning, this limits the type of planning that can be done for you.
If you require nursing home care, do you want to preserve and protect your assets for your spouse who is still living at home or for your other loved ones after you are gone? Regardless whether you are single or married, federal and state legislators have provided you with a number of tools to help pay for your nursing home care that you can use to preserve and protect your hard earned assets for your loved ones. You can put instructions in your financial power of attorney to provide for this, but you have to put those instructions in today while you are alive and well.
Healthcare issues may also effect what type of coverages that you receive from your Medicare plan. Traditional Medicare has a certain set of coverages. Each of the private Medicare Advantage plans have their own different types of coverages which change year to year. With a Medicare Advantage plan, what is covered this year may not be covered next year.
I regularly hear reports from or about Medicare participants who have to private pay for medical procedures or treatments because their particular Medicare Advantage plan did not cover it. If you have a specific ailment, make sure that your plan covers treatments for it.
Similarly with Medicare Part D prescription coverages. Depending upon the prescriptions you are taking, the prescription coverage that you have this year could be substantially different than the coverage that you had in the same plan last year.
If you are like most people, you would not want to be placed in a nursing home if you could be at home. Leave instructions to that effect. But if you did end up in a nursing home, is there one that you prefer, or one in which you do not want to be placed.
How many medications are you currently taking? Are there so many that you have to keep them in a plastic tub? I have encountered more than one case in which a senior was on multiple medications, appeared to be suffering from dementia and was cared for as such in a nursing home setting.
After the patient was weaned off a number of their prescriptions, they came out of their “dementia” fog. It is impossible for pharmaceutical companies to test the side effects of the millions of possible combinations of drugs. Would you want to have spent your life savings on nursing home care when it possibly could have been avoided? Do all your doctors know all of the medications prescribed by the others.
Do you have a certain medical condition that requires certain medical treatment at certain times? Do your loved ones know what needs to be done? Write down instructions and keep them with your estate planning documents so that they are there when needed.
To assist you to make sure that your wishes are going to be followed, it is important that you and your loved ones understand these and similar healthcare issues. It is also important that you seek the assistance of qualified estate planning and elder law specialists. Elder law attorneys deal with these and many other related issues on nearly a daily basis. With proper planning, your instructions can be followed by the persons you choose.
By: Matthew M. Wallace, CPA, JD
Published edited June 21, 2015 in The Times Herald newspaper, Port Huron, Michigan as: Health care is key to estate planning