Blog, Chicago area, Chicago Elder Law, Chicago Elder law attorney, Chicago Suburban Elder Law Attormey, Chicago Suburbs, Chicagoland Elder Law, Elder Law Articles, Eldercare Attorney, Estate Planning, Estate Planning Attorney, Guardianships, senior estate planning
Powers of Attorney – Your “Lifeblood” (Financially and Legally Speaking)
Installment 1 of 10
In Our Series: “Long Term Care Costs for the Middle Class: 10 Steps to Asset Protection Through Medicaid in Illinois, for Middle Class Seniors and Boomers”
Problem: We had six families of aging seniors come in to our office this week all of which had powers of attorney that amounted to nothing more than a simple document that would be much more appropriate for clients who are 25 years old. This is a devastating problem that I can correct if the aging Senior has the requisite mental capacity to execute new documents. If, however, the Senior has diminished capacity, then we are left with these almost worthless powers of attorney that do not permit any repositioning of assets in order to properly plan for long-term care, and a path to Medicaid to fund such long-term care. Solution: Revise Any Powers of Attorney and Healthcare That You Currently Have, and While You Can. Powers of Attorney for Property: Most of the powers of attorney that we see in our office, while valid, are inadequate to allow the necessary repositioning and reclassification of assets to gain eligibility to Medicaid, VA, and other governmental benefits. Your power of attorney for property must permit, at a minimum, the following powers: the transfer of assets to family members and nonfamily members, with or without compensation being received in exchange; the transfer of the personal residence; the creation, funding, and revision of revocable and irrevocable trusts; the authority to apply for various governmental benefits, including Medicare, Medicaid, VA benefits and other benefits; and the ability to change beneficiary designations on various assets. This is only a small list of must-haves in your power of attorney for property. To give you an idea of the importance of this, we attach an additional five pages of these types of powers so that every client we have has a full toolbox of resources available to carry them through their maturing years and senior years. These tools are most often needed in the senior years when long-term care planning is a necessity so as to avoid having our seniors rendered penniless due to the devastating costs of long-term care. Be careful about selecting an effective date for your power of attorney. Remember you can sign a power of attorney today that either (1) takes effect today, or (2) takes effect upon a future event, such as when your doctor determines you are unable to make financial decisions for yourself. The approach you select will depend on your particular circumstances and your family composition. Remember, anyone can create a document, but correct elder law counseling about that document will help you achieve the best results. Contact your Chicago elder law attorney or Illinois elder law attorney today to discuss this. Powers of Attorney for Healthcare: In January 2015, the State of Illinois legislature enacted a new power of attorney for healthcare. However, some bar associations have found this version of the power of attorney to be ineffective in five or six important areas. As of this moment, these defects are being cured through pending legislation in the Illinois General assembly. The healthcare power of attorney is your authority to express your wishes about your care and your end-of-life wishes. Please keep your eyes peeled to this blog for an update on the changes that are forthcoming to make this important document better in the future. Summary: I hope this gives you a simplistic view about the importance of powers of attorney in the state of Illinois. These documents are critical to enable your agent to use Medicaid asset protection strategies to qualify you for Illinois Medicaid should you need institutionalized care. Remember, most of our clients are trying to preserve some assets for a “rainy day fund” in their senior years, and they are entitled to do so as a matter of exercising their civil rights so long as they do this legally and ethically. This planning is not done by wealthy individuals, as those persons can pay their way through any costs associated with long-term care. Rather, this planning is best done by middle class individuals who have worked to accumulate some savings, only to find that the cost of long-term care will make their life’s work disappear in no time. Our goal, as asset protection attorneys for the middle class, is to allow seniors to gain access to the Medicaid program, to use some of their own assets for their cost of long-term care, but also to enable them to preserve some of their assets, so that in their senior years, after a lifetime of work, they are entitled to some dignity and some resources to make a life in a nursing home more livable. Coming up in our future blogs in this series:- Revise Powers of Attorney – See Above
- Contact a Physician
- Seek Guardianship
- Revise Old Wills and Trusts
- Create a Blueprint
- Inventory Assets
- Seek Placement in a Facility
- Select a Strategy
- Prepare and File the Medicaid Application
- Prepare for the Post Application Audit