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POWER OF ATTORNEY INSTRUMENTS AND ADVANCE MEDICAL DIRECTIVE
Power of attorney instruments and the advance medical directive are integral aspects of a well-rounded estate plan, regardless of age or economic status. People often believe that once they have executed a Last Will and Testament they have formed a complete estate plan. However, power of attorney instruments and the advance medical directive are highly recommended, valuable instruments to complete the estate planning process. Power of attorney instruments and the advance medical directive express an individual’s wishes and authorize one or more third parties to act on his or her behalf, in accordance with such expressed wishes. The onset of an inability to act on one’s own behalf may be triggered by a lack of physical ability as well as by a lack of requisite mental capacity to perform the desired action. Further, an inability to act on one’s own behalf may be temporary or permanent in duration, depending upon the nature of the triggering event. An individual may narrowly or broadly define the scope of power and the circumstances under which the third party(ies) may act on his or her behalf. The individual who executes the power of attorney instrument or advance medical directive and whose wishes are expressed therein is referred to as the “principal” or “grantor”. The third party(ies) who has the authorization to act on behalf of the principal/grantor is referred to as the “agent” or “attorney-in-fact”.
Although a principal may name multiple individuals to serve as agents concurrently (at the same time), a potential issue arises when the named agents are unable to reach a majority or unanimous decision (depending upon the terms of the instrument) with regard to contemplated action. As an alternative, the principal may designate one or more successor agents who are authorized to act in the event the initially-named agent is unavailable or unable to serve for whatever reason.
All power of attorney instruments (general, as well as medical) terminate upon the death of the principal.
General Power of Attorney
A general power of attorney instrument is a legally binding instrument that authorizes an attorney-in-fact to act on behalf of a principal in certain situations and/or upon the occurrence of a triggering event. For example, the principal may grant the attorney-in-fact broad power to handle his or her finances, including management of accounts and authorization to sign checks on behalf of the principal. Alternately, a general power of attorney instrument may limit the scope of authority to narrowly defined areas, such as an authorization to make tax-related decisions or invest in real estate or even to make gifts.
A general power of attorney instrument may be effective upon its execution and indefinite in duration (“durable”) or the instrument may be effective only upon the occurrence of certain triggering events or dates (“springing”). A concern associated with springing general power of attorney instruments is defining the events or dates that trigger the effectiveness of the instrument. For example, if the principal wishes for the instrument to be effective only upon his or her mental incapacity, a physician will most likely have to declare the principal incompetent. Extensive privacy regulations enacted in recent years may deter a physician from willingly disclosing a determination with regard to competency unless the instrument specifically authorizes the physician to reveal such information.
Medical Power of Attorney
A medical power of attorney instrument is a legally binding instrument that authorizes an attorney-in-fact to act on behalf of a principal in connection with medical-related matters. Although a principal may limit the scope of power granted to the attorney-in-fact under the instrument, the attorney-in-fact typically has broad authority to make decisions related to the principal’s medical care and treatment.
A potential issue one should consider prior to execution of a medical power of attorney instrument relates to the waiver of health-related privacy rights concerning his or her medical records. Waiver of health-related privacy rights may allow the attorney-in-fact more liberal access to medical records and therefore better equip the attorney-in-fact to make a well-informed medical decision on behalf of the principal. As discussed above in the introductory section, a potential issue arises when a principal names multiple agents to serve at the same time. This issue may be especially detrimental with regard to the medical power of attorney instrument since medical-related decisions are often time sensitive and any delay in the decision-making process may negatively impact the health of the principal.
Advance Medical Directive
An advance medical directive is a legally binding instrument that applies only in the event an individual develops a terminal condition and either death is imminent or the individual is in a persistent vegetative state. Even if an individual develops a terminal condition and either death is imminent or the individual is in a persistent vegetative state, an advance medical directive only grants the agent power to make decisions related to life-prolonging procedures. Since the advance medical directive is only effective in limited situations, an individual should also execute a medical power of attorney instrument.
According to the laws of the Commonwealth of Virginia, in order to be effective, an advance medical directive must be signed in the presence of two witnesses. In addition, attorneys often recommend that an individual request that his or her primary physician place an original advance medical directive in the individual’s medical files.
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