When You or Loved One Has a Chronic Illness
By Cowles Liipfert
If you or a loved one is living with a chronic illness, such as Parkinson’s, multiple sclerosis or Alzheimer’s, it is important that the necessary persons have their estate planning documents in place and that they address the likely issues which may arise due to the chronic illness.
It has been estimated that about 157 million Americans are living with chronic illnesses, and also that about nine million cancer survivors are living with side effects from their treatment. The percentage of lives impacted by chronic illness grows dramatically with age, and our population continues to grow older. Approximately half of those individuals who are age 85 or older have some cognitive impairment.
Older people, even those who have no chronic illnesses, should have some of the same estate planning documents as younger people, but it is more important for them to have their documents in place because of the likelihood that their health will become more complicated with age. If you (or a loved one) has a chronic illness, it may be necessary to have documents which are personally drafted to serve your specific needs, and to address your challenges.
When a younger person has a chronic illness, he or she may have minor children, for whom special consideration must be taken – Who will take care of the child or children if the parent dies or is unable to care for them? One can appoint a guardian for his or her minor children in a will, which a court will usually respect if there is no surviving parent. Older children about age 14 or older, could also have some say-so, and it is good to let children be part of the planning process. Special provision also needs to be made for financially assisting the guardian with support and educational expenses.
If you let your chronic illness progress too far, it might impede your ability to understand your legal documents and you may even lose your ability to sign those documents. Consequently, it is best to address your personal issues and to get your legal documents in place, as soon as you can after diagnosis.
We realize that it may be difficult for you or your loved one to do so, as you are likely to be dealing with overwhelming medical issues, as well as the shock (and perhaps depression) from learning about your diagnosis. Your advisors do not necessarily need expertise in dealing with your specific illness, but they must have empathy and a willingness to tailor their usual approaches to meet your specific needs.
The key documents that you might need are the following;
Health Care Power of Attorney.
Financial Power of Attorney.
Living Will and Advance Directive.
A Health Care Power of Attorney is a document in which you designate someone to make medical decisions for you, if you are unable to make or communicate those decisions for yourself. The most important decision is to select the proper person and possible successors, in case that person becomes unable to act for you. You may need to coordinate your Health Care Powers of Attorney with your financial Power of Attorney discussed below, because health care and financial decisions are likely to be interrelated.
This document should be a “durable” power of attorney which remains fully effective if you lose your competency. This document designates a trusted person or corporate fiduciary to handle legal, financial and tax matters for you if you are unable to handle those matters for yourself.
A key question to consider is how much control to give out now, if any, and how much control is to be relinquished in the future, if your condition progresses? You should relinquish enough control so that you can be assisted as necessary, but you may prefer not to relinquish any more than you need at any point in time.
Another point to consider is the issue of compensating your agent. Some powers of attorney provide for no compensation, and many family members are willing to act in that manner. However, that may become burdensome if the agent has to act for many years to assist you. If the agent has modest means of his or her own and is required to spend a great deal of time on your behalf, you may want to provide for compensation, even if the agent initially tells you not to provide for it, and/or there could be a creative way to make special provision for the agent in your Will.
A “living will” or Declaration of Desire to Die a Natural Death expresses your desire not to have your dying process prolonged by extraordinary means if you are terminally and incurably ill, and if you are likely to die in the near future.
If you are living with a chronic illness you might want to modify the general language to disclose your specific condition. If you want to address matters such as experimental treatments and drugs, you may do so. Tissue and organ donations are allowed under a living will, and if you have a chronic illness, you may want to modify that language.
Federal laws have been passed, called the HIPAA laws, to protect the privacy of a patient’s health information. A health care provider is required to keep your health care confidential unless you authorize the disclosure of that information to specific individuals.
If you are not able to give permission to disclose your health care information when admitted to a hospital or other health care facility, you should have a HIPAA Release signed while you are able to do so, authorizing the release of your otherwise-confidential health information to be released to individuals named in the release form. That health information will be essential for the people who are helping you to interact with your health care providers. Even though your health care decision-makers are the only people who can make your heath care decisions, you may prefer, for personal reasons, to name other family member or other loved ones to have access to your health information, too, so that they will be able to talk with your health care providers about your medical condition, even though they may not be the persons making your medical decisions for you.
Revocable Trusts are often used in estate planning to avoid the publicity, cost and difficulties of court probate or administration at one’s death, but if you or a loved one has a chronic illness, a Revocable Trust may provide more control and better continuity during your lifetime than simply using a financial power of attorney. Also, you may be able to incorporate into a Revocable Trust Agreement better safeguards and protections that are typically provided for under a power of attorney.
Although not frequently, we have occasionally had to deal with a trusted individual who abuses his or her authority under a power of attorney, and a trust agreement is a a somewhat better mechanism for monitoring them than a simple power of attorney.