By Leu,Peirce & Olson PLLC
Throughout history, the New Year has always been representative of a new beginning. Every January 1st presents us all with the opportunity to take an inventory of last year’s resolutions and recommit ourselves to a new set of goals. Due to the lingering effects of the Covid-19 pandemic, many will add “getting affairs in order” to their list of aspirations for 202. Many people think only of a Will when contemplating the legal documents necessary to protect their future. However, there are more documents and considerations in developing a well-rounded estate plan. Every estate plan ought to include the following:
- Durable Power of Attorney
- Medical Power of Attorney
- Directive to Physicians and Family or Surrogates (Living Will)
- Authorization to Release Medical Information (HIPAA Authorization)
- Declaration of Guardian
- Will
- Long-term Care Insurance
Although often overlooked, a Durable Power of Attorney and a Medical Power of Attorney are critical parts of long-term care planning, since they designate the person or persons who will be acting for you in the event you are unable to handle your own financial and health care decisions. Without these documents, no one, not even your spouse, is legally authorized to handle your finances or make medical decisions for you.
Your estate planning documents are extremely powerful and should be executed after great contemplation. The people you appoint to act on your behalf as your agents should be those you trust fully to handle your affairs now, as well as when you cannot handle them on your own. If you do not trust the person you have named to act for you right now, be careful about naming that person to act for you when you are incapacitated. Often people appoint spouses, adult children, or other family members as agents to keep affairs private and to avoid hurting feelings. However, appointing a family member may not always be the best option. In all cases, signing estate planning documents should be done only after deep reflection as to the abilities and trustworthiness of each candidate.
In addition to the essential legal documents listed above, another planning area that warrants early and informed consideration is preparing for the cost of funding long-term care. Long-term care differs from other types of healthcare, in that the goal of long-term care is not to cure an illness, but to provide an individual with support so they can maintain an optimal level of functioning. Some people want to stay in their homes as long as possible and bring in outside help to make that possible. Others want the freedom from home maintenance that a senior residence community offers. There is a wide range of living arrangements for seniors, from retirement communities to assisted living facilities to skilled nursing facilities. There exists a long-standing myth that Medicare will cover all our healthcare needs, including the cost of long-term care. The reality is that Medicare provides support only in limited situations. Notably, Medicare does not pay for assisted living, memory care, or long-term custodial care in skilled nursing facilities.
Some people are fortunate to have the ability to private pay for long-term care, which ranges from $4,000 – $16,000/month in the Dallas-Fort Worth area.Others have long-term care insurance (an insurance policy designed to cover long-term healthcare expenses that are not covered by health insurance or Medicare). However, long-term care insurance may not be available if you have certain existing health problems, and the costs and premiums can rise as you age. Therefore, it is important to investigate the availability of long-term care insurance as early as possible. If you cannot qualify for long-term care insurance, there are financial options that may fit your circumstances and provide similar coverage. Professionals who work primarily with seniors, such as Elder Law attorneys, can often provide connections to a community of support agencies and other professionals who may be of assistance to you as you explore your options.
This year, resolve to take the time to craft a thoughtful, and thorough, estate plan. Educate yourself on your options, and seek qualified professional advice on legal documents, healthcare, insurance, and financial planning. A little planning now goes a long way towards ensuring that you and your loved ones are protected, no matter what the future holds.
Lori Leu, Erin Peirce, Lauren Olson, and James Sifford are Elder Law attorneys with Leu, Peirce & Olson, PLLC located in Plano, Texas. They can be reached at 972-996-2540.
