Frequently Asked Questions About Elder Law
Q. What is an elder law attorney?
A. An elder law attorney is one who provides legal services to older persons and people with disabilities and their families. There are special laws affecting the elderly and persons with disabilities, and an elder law attorney concentrates their study and practice on these laws.
Q. Do you know the advantages of using an elder law and special needs attorney?
A. An elder law attorney works to ensure that the laws affecting you or your loved one are applied correctly. The agencies who administer the programs for the elderly and people with disabilities establish policy guidelines. Sometimes, policy guidelines are not permitted by the governing law. Ms. Weber successfully protects her clients from such mistakes. The laws and policies affecting elderly and disabled persons do change over time. In fact, many of the laws require annual adjustments.
Ms. Weber devotes her time and resources to study these changing laws. She attends conferences each year to stay influenced and abreast of the ever-changing laws and issues of concern to her clients. A qualified elder law attorney understands the background, purpose and reason for the laws and the changes in the law. As an elder law attorney, Ms. Weber also works closely with other professionals such as social workers, nurses, physicians, nursing home administrators, accountants and Medicaid caseworkers. Ms. Weber often provides in-service training for these professionals. As a result, Ms. Weber learns about the issues affecting her clients from different perspectives.
In short, an elder law attorney like Karen H. Weber is often able to connect her clients with others to address all the issues of the client. A qualified elder law attorney is a member of a network of service providers dedicated to meeting the needs of the elderly and persons with disabilities. An elder law attorney frequently assists the family in changing their role from care provider to care advocate.
Go to the NAELA website to see other advantages of using an elder law attorney. They have a brochure called "Elder Law: A Practice Coming of Age."
Q. Must I sell our home to obtain Medicaid benefits?
A. Generally, no. The home is an exempt asset for Medicaid qualification purposes. In other words, it is not counted toward the asset limit for Medicaid qualification. However, the home is generally exempt only as long as either spouse (or another qualified person) is living in the home or intends to return home. The home will be subject to Medicaid estate recovery unless appropriate planning has occurred or another exception exists.
Q. Is it too late to save resources if my loved one is already in the nursing home?
A. Generally, no. It is not too late to save assets just because your loved one is already in the nursing home. However, there are special and complicated rules regarding transfers of assets.
Q. Does my revocable living trust protect our assets from Medicaid spend down?
A. Generally, no. Assets held in a revocable living trust are "countable" for Medicaid qualification purposes.
Q. What is a durable power of attorney?
A. A durable power of attorney is a legal document by which one person, ''the principal,'' authorizes another, "the agent," to act on the principal's behalf regarding financial and/or medical decisions. A durable power of attorney is one of the most important planning tools available today. "Durable" means the authority granted in the document remains valid and effective if the principal becomes incapacitated after executing the document.
Q. Who should have a durable power of attorney?
A. Every person over the age of 18 years should consider executing a durable power of attorney. More specifically, all persons wishing to avoid court involvement and at the same time provide for the continued management of their assets and health care in the event of physical or mental incapacity should have a durable power of attorney in place.
Q. How long will a durable power of attorney be effective?
A. If properly drafted and executed, a durable power of attorney will continue indefinitely so long as there is not a stated termination date and provided the power is not limited to a particular transaction. The principal may, however, revoke the powers and duties delegated to an agent. A revocation should be made in writing and acknowledged in the same manner as the durable power of attorney.
A power of attorney is automatically revoked upon the death of the principal. A power of attorney which is not "durable" will terminate upon the principal's disability or incapacitation.
Q. Are there any disadvantages to a durable power of attorney?
A. Yes. Like most legal and financial decisions, there are advantages and disadvantages to the durable power of attorney. The advantages include relatively low cost, privacy, the opportunity to select dependable people and, until incapacity actually occurs, the opportunity to revoke or change the power of attorney. Problems can occur, however, if you are not careful in the selection of your agent since this individual will have decision-making authority in the management of your financial and other affairs.
Q. What happens if I don't have a durable power of attorney?
A. Without a properly executed durable power of attorney, nobody, including your spouse, has the authority to make decisions on your behalf. The assets of a disabled individual will likely be frozen and inaccessible and no one will have authority to make medical decisions for you. Without advance directives, life-prolonging treatments that the patient may not have otherwise desired will probably continue.
For many families of people with disabilities, there is no choice but to seek court intervention and petition for the appointment of guardian and/or conservator. Unfortunately, such proceedings are costly and require on-going, strict court supervision.
A durable power of attorney, on the other hand, allows the agent to act immediately upon the principal's incapacitation.
Q. What does it mean to be a "fiduciary"?
A. This means you will be held to the highest standards of good faith, fair dealing and undivided loyalty with respect to the principal. You must always act in the principal’s best interest and keep his or her goals and wishes in mind in making any discretionary decision. However, you do not have the same responsibility as a trustee or executor, who has total control over the estate or trust assets, since you share control with the principal. Your fiduciary duty as attorney-in-fact covers the discretionary actions you take on your own as attorney-in-fact for the principal.
Q. When does the durable power of attorney take effect?
A. Unless the power of attorney is "springing," it takes effect as soon as it is signed by the principal. A "springing" power of attorney takes effect only when and if the event described in the document itself takes place. Typically, this is the incapacity of the principal. In most cases, even when the power of attorney is immediately effective, the principal does not intend for it to be used until he or she becomes incapacitated. You should discuss this with the principal so as fiduciary you are aware of and can carry out his or her wishes.
Q. What if there is more than one attorney-in-fact?
A. Depending on the wording of the power of attorney document, you may or may not have to act together on all transactions. In many cases, when there are multiple attorneys-in-fact, they are appointed "severally," meaning they can each act independently of one another. Nevertheless, it is important for them to communicate with each other to make sure their actions are consistent.
Q. Can a power of attorney agent be fired?
A. Yes. The principal may revoke the power of attorney at any time. He or she must notify the agent of the revocation and should put it in writing. It is also wise to notify all asset holders of any revocation. The appointment of a conservator or guardian may not immediately revoke the power of attorney. Depending on the state in which the principal lives, the decision to revoke a power of attorney may lie with the court appointing the guardian or conservator. In other states, this decision may rest entirely with the guardian or conservator.
Q. What kind of records should a power of attorney keep?
A. It is very important that you keep good records of all your actions taken under the power of attorney. That is the best way to be able to answer questions anyone may raise. The most important rule to keep in mind is not to commingle your own funds with the funds you are managing for the principal. Keep the accounts separate. The easiest way to keep records is to run all funds through a checking account. The checks will act as receipts and the checkbook register as a running account.
Q. Can I be compensated for my work as attorney-in-fact?
A. Yes, if the principal has agreed to pay you. In general, the attorney-in-fact is entitled to "reasonable" compensation for his or her services. However, in most cases, the attorney-in-fact is a family member and does not expect to be paid. If you would like to be paid, it is best that you discuss this with the principal, agree on a reasonable rate of payment and put that agreement in writing. That is the best way to avoid misunderstandings in the future.