Power of attorney documents have the important job of appointing someone to make medical and financial decisions when you are unable to communicate your wishes.
Power of attorney documents are an integral part of good estate planning. A will is useful only after you pass and those people named in a living trust to handle your affairs if you are unable to act can only manage assets in the living trust. Any assets outside a living trust require an agent or attorney-in-fact to be named in a financial power of attorney.
A power of attorney can take effect immediately, it can be in effect for a limited amount of time (if you are heading out of the country for a period of time), at a future point (called a springing power of attorney) and a power of attorney can be durable, meaning it is effect should you be declared incapacitated by a physician.
Your financial power of attorney documents list the powers that the agent or attorney-in-fact have while acting. Those agents and attorney-in-facts have a fiduciary responsibility, meaning they are legally held responsible for their actions. If a court feels the person has acted reckless or negligently, they can be held legally responsible for their actions or inactions.
Your medical power of attorney appoints someone to make medical decisions for you should be unable. These decisions may range from types of treatment and medication to whether to remove you from life support.
Related documents include a living will or health care directive which states your intentions regarding the use of life support.
Mental health care power of attorney documents are becoming more common, which separate general medical decisions from those decisions regarding your mental health. These decisions may include topics of medication, release of medical records and whether to admit you to a treatment facility.
If your existing power of attorney documents are older than 2004, you should check to see that HIPAA related clauses are included with your power of attorney documents to allow the release of medical information from your physicians. Without a HIPAA release, those acting as your agents and attorney-in-facts may experience delays in receiving proper documentation needed by financial institutions proving your incapacity. Consult an estate planner for more information.
Power of attorney documents can often be downloaded free of charge from your state bar's website.
Once you pass, your power of attorney documents are no longer of any use.