Here’s a quick test. Which of these Estate Plan Documents is the most critical? Will, Revocable Trust, Durable Power of Attorney or Health Care Power of Attorney? The most common answer is the “Will.” The “Durable Power of Attorney” is the correct answer – here ‘s why. The Durable Power (“DPOA”) allows you to appoint an agent, who we call the “Attorney in Fact” to perform any legal tasks that you are able to do – while you are living. When the DPOA is “immediate” – it is effective when you sign it. When it is “springing” it is effective only when you are incapacitated. If you have a DPOA, your agent is able to transfer your assets and do emergency estate planning when you are in the hospital or nursing home. As long as you are living, the DOPA is effective (unless you revoke it).
Often times, when Mom or Dad are at the end stage of live, the need for nursing home care crystalizes during the episode where Mom or Dad are admitted to the hospital and from there they are discharged to a nursing care home for rehab. To stay at the facility beyond Medicare paid rehab (which is a max of 100 days if actively pursuing rehab) you are either in a private pay mode or must be qualified for Medicaid. While most people don’t know this, the difference is only money – as most skilled nursing facilities have Medicaid and Medicare beds available. Private care can run as much as $12,000 per month. Medicaid, when properly planned, costs no more than the social security and pension benefit Mom or Dad is receiving. To qualify for Medicaid and to minimize the cost (which means to save the money for the other spouse), emergency planning must be done. Before COVID, assuming Mom and Dad were lucid, we could go to the Nursing home and have Mom and Dad execute a DPOA. Once signed, the financial moves could be made, and the Medicaid application submitted.
With COVID -this has changed because of “NO VISITORS ALLOWED.” Beyond the horrific difficult of settling Mom or Dad into the nursing care facility without being able to spend time with them – there is no way to get a DPOA signed. The solution is simple – you need to make sure there is a DPOA signed and in effect before the hospital issue arises. There are hundreds of other reasons why this should have been addressed years earlier – but COIVD makes this an urgent need for anyone! COVID is not limited to the elderly – which means if you’re an adult – you need a DPOA in effect today.
This Wednesday evening and Saturday morning, we are doing our second FREE Webinar in the COVID era and you are invited. It is called, Necessary Estate Planning Steps In View Of The Coronavirus. We will cover the nuts and bolts of estate planning in the COVID era – be sure to sign up below.
We are flattening the curve, and a return to the life we know is going to come. Be patient and stay safe,
Did you know that THAV GROSS offers free consultations for business, financial, and tax problems? Call us anytime – (248) 645 – 1700 or CLICK HERE to send us a message.