Congress uses many difficult acronyms – one of them is HIPAA. It stands for the Health Insurance Portability and Accountability Act, enacted in 1996.
From an estate planning and elder law perspective, the HIPAA law is quite relevant.
Incapacity Among Elders
At the age of 67, your life expectancy is at least 85 years depending on your gender according to the Social Security Administration. The Alzheimer’s Association tells us that over 35 percent of people that are 85 and older have contracted this disease.
There are other types of dementia, and serious physical illnesses can cause incapacitation. Clearly, no one envisions himself in this position, but the possibility is real.
Incapacity Planning and the HIPAA Release Authorization
If you do not prepare for incapacity, the state might have to appoint a guardian to act on your behalf. That guardian may not be the person you would have selected when you were fully capable.
These circumstances also tend to create disagreements among family members. Fortunately, you can prevent a guardianship by executing the necessary incapacity planning documents.
Advance directives for health care generally address medical decision-making. You may appoint an individual to make decisions on your behalf through a durable power of attorney for health care.
A living will is another useful directive. This type of will records your preferences regarding the use of life-sustaining measures like mechanical respiration, resuscitation, and artificial hydration and nutrition. If you have comfort care medication preferences, you can address these as well. A living will also records your preferences for organ and tissue donation.
HIPAA restricts doctors from discussing your medical information with individuals. Because of this restriction, you should sign a HIPAA release form providing your representative access to your medical records.
Financial Decision Making
In addition to medical decisions, you should account for financial decision-making when developing your incapacity plan.
If you use a living trust as your asset transfer vehicle, you act as the trustee while you are alive and well. When you are drawing up the trust, you name a successor trustee to administer the trust after your passing.
Your successor trustee may also be empowered to administer the trust in the event of your incapacity. It is possible to name someone to be the successor trustee, and a different person to act as the disability trustee.
If you use a will to facilitate asset transfers, you may name a financial representative in a durable power of attorney for property. Even if you have a living trust, you should have a durable power of attorney for property as a back-up.
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