The Importance of a Power of Attorney, Health Care Proxy and Living Will
Why Every Adult Should Have a Power of Attorney, Health Care Proxy and Living Will, Not Just Seniors
The Power of Attorney:
Many people believe that a Power of Attorney is a document people need in place later in life; however, that is not true. A Power of Attorney is one of the most important documents that every person should have in place once they turn eighteen (18) years old. Without this document, New York State will need to appoint someone to manage your affairs, and it may not be who you would prefer or trust to make those decisions.The Durable Power of Attorney allows an agent, chosen by you, to manage your financial affairs during your lifetime in the event you are not able to manage them yourself. If you are in an accident and unconscious in the hospital for an extended period of time and have bills to pay, taxes to file, or someone needs to call your insurance company, no one will be able to manage those affairs for you without a Power of Attorney in place. Once you are recovered and able to manage those affairs on your own, the agent no longer needs to act on your behalf.If you do not have a validly executed Power of Attorney prior to becoming unconscious or incapacitated, someone will need to file a Petition in a NYS Court in order to be appointed a Guardian over your person and/or property in order to manage your affairs. A guardianship proceeding can be both emotionally, and financially stressful for a loved one. This proceeding can also be very time-consuming and, therefore, may not be the right course of action in an emergency situation. Pursuing guardianship may result in someone being appointed who may not know your wishes or intentions. With a Power of Attorney, you choose who will make financial decisions for you, in the event that you are not able to make them yourself.A Power of Attorney can be revoked at any time so long as the person has the capacity to revoke it. So, if circumstances change and you need to change your agent, you would meet with an attorney to revoke your Power of Attorney and execute a new one. On the other hand, the removal of a guardian is not as simple, once a guardian is appointed, another proceeding would need to be initiated to remove the guardian if the person is no longer incapacitated.
The Health Care Proxy and Living Will:
Upon reaching the age of eighteen (18), you are the only person who is permitted to make health care decisions on your own behalf. New York State Law permits your next of kin to make medical decisions for you if you are unable to make them on your own behalf. However, your next of kin may not be the person whom you would prefer to make those decisions on your behalf, and they may not be able to access your medical records to aid them in making that decision. As such, it is important to have a valid Health Care Proxy and Living Will in place.A Health Care Proxy allows your agent to make medical decisions on your behalf in the event that you are unable to make them yourself. A Living Will provides guidance to your Health Care Proxy about your wishes for your medical care, including life-sustaining measures. Without a Health Care Proxy and Living Will, if long-term medical decisions need to be made and your family/loved ones do not agree on what medical care should or should not be given, a guardianship proceeding may need to be commenced, or a judge may need to be involved in the decision process. Again, a guardianship proceeding may be costly both emotionally and financially and may not be the best course of action in the event of an emergency.
Why Is It Important to Have an Attorney Draft Your Power of Attorney, Health Care Proxy, and Living Will?
The Power of Attorney:
New York State changed the requirements for a Statutory Durable Power of Attorney in 2021 to combat a refusal by financial institutions to accept a validly executed Power of Attorney. The new law requires that your Power of Attorney substantially conform to the language in the General Obligations Law. If your document is not drafted by a New York State licensed attorney, it may not comply with the statute and therefore may not be accepted by a financial institution.The Power of Attorney may need to be modified to meet the individual needs of a person. However, these modifications must also conform with the statutory requirements, and if they do not, then the document may not be accepted as valid. One such modification, that may be missing from your Power of Attorney is authorization for your agent to access your health information for communicating with your insurance under the Health Insurance Portability and Accountability Act (HIPAA). Meeting with an attorney can help you decide which powers to modify in order to grant your agent all of the necessary powers to act effectively on your behalf. Additionally, the new law removed the separate Statutory Gift Rider that was required to permit your agent to make gifts and added gifting language to the modifications permissible in the new Power of Attorney.Prior to the changes in 2021, there was no requirement that the principal’s signature be witnessed unless they were granting their agent gifting abilities under a separate Rider. Now, the Power of Attorney must be signed, and duly notarized and acknowledged, and must be witnessed by two persons who are not named as agents or recipients of gifts. If you are unable to physically sign but have the mental capacity to execute a Power of Attorney, you are able to direct that someone sign the document on your behalf, so long as they are not your agent, a witness or the notary. Because of the more formal requirements of executing the Power of Attorney, it is important that you seek the guidance of a licensed attorney to ensure that you are validly executing your document.If you executed a Power of Attorney prior to 2021, you should carefully review that document with an estate planning attorney to ensure that it meets your needs and complies with all statutory requirements.
The Health Care Proxy:
The Health Care Proxy that is sometimes executed in a doctor’s office may only be valid in that specific office and may not include the necessary HIPAA language to allow your agent to access your medical history. As such, any decision made by your agent would be made without regard to your medical history. Additionally, your Health Care Proxy and Living Will must be signed in the presence of two witnesses.You should consult with an estate planning attorney to ensure that your Health Care Proxy and Living Will meet your needs, allow your agent to effectively carry out your wishes, and comply with the statutory execution requirements.Because there are specific requirements under the law for drafting and executing a valid Power of Attorney, Health Care Proxy, and Living Will, the cost of errors caused by using DIY forms can be much greater than having an attorney draft and witness the execution of these documents.