Powers of attorney for healthcare and property are some of the most important legal documents you can have to protect your interests. They are used to designate someone (an agent) to make decisions for you in the event you cannot make decisions regarding your own healthcare or finances. If you become disabled and you have not executed powers of attorney, the court must appoint someone (a guardian) to make these decisions on your behalf.
The appointed guardian is not necessarily your spouse, parent, child, sibling or friend. When a guardian is appointed, annual accountings must be filed with the court. Guardianship proceedings are often extremely burdensome from both the financial and the emotional perspective. Litigation arising from both physical and financial abuse in this area of law has significantly increased in recent years. Therefore, if you do not have a power of attorney for healthcare and a power of attorney for property, it is extremely important that you execute them immediately.
On July 1, 2011 powers of attorney for healthcare and property were updated in Illinois. Powers of attorney for healthcare executed prior to July 1, 2011 do not contain Health Insurance Portability and Accountability Act of 1996 (HIPAA) language, which is necessary under federal law to obtain private health data. Consequently, individuals acting as agents under an outdated power of attorney for healthcare may not be able to obtain your medical records.
The recent updates to powers of attorney for property mandate that an agent keep complete records of all financial transactions that occur while he or she is acting on your behalf. Also, some banks and financial institutions may not accept an outdated power of attorney for property or it may take much longer to obtain funds.
It is vital that powers of attorney and other estate planning documents (such as wills, trusts, and living wills) are periodically updated to ensure that they effectively reflect changes to both the law and an individual’s personal situation. Improper alterations to these documents (removing names, inserting names or changing the amount of money a beneficiary will receive, etc) are not recognized by the courts, healthcare institutions or financial institutions. Therefore, it is imperative that your estate planning is periodically reviewed and updated by an attorney who concentrates in this area of law.