Special Planning Considerations for Alzheimer’s and Dementia

POSTED ON: March 8, 2022

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Special Planning Considerations for Alzheimer’s and Dementia

If you receive an Alzheimer’s or dementia diagnosis, planning for the future must begin as soon as possible.

Preparing for incapacity must be done while you still have legal capacity: the ability to express your own wishes and understand the implications of documents that are created to enforce and protect them. Once you become incapacitated, you may not sign legal documents. In the absence of proper incapacity legal planning in advance, a court process will then be required to appoint financial and health care decision-makers for you. This process can be lengthy and expensive. It also will expose your private personal, health and financial circumstances to the public record.

What Documents are Needed for a Person with Dementia?

Through a general durable power of attorney (POA) you can appoint a trusted individual as the agent (also known as the attorney in fact) to manage your financial and legal matters. While a POA can give limited powers, in cases of Alzheimer’s or dementia, broader powers should be given to the agent. Why? Your appointed will most likely need such authority to conduct all and any financial and legal matters on your behalf. A complete list of all assets, including bank accounts, pension and retirement plans, investment accounts, real property and digital assets should be created and provided to the agent appointed under your POA.

If you have executed a last will and testament, then it should be reviewed without delay. Make sure that it still reflects your wishes, especially when it comes to the executor you have appointed and to the distributions you want made to your beneficiaries. If you have any minor children, you should also make sure that the guardians you have nominated are still willing to serve.

What Healthcare-Focused Documents Should Be Prepared?

While executing your POA, remember to execute a healthcare power of attorney as the agent. In some states, this document is also known as a health care proxy. The individual who you appoint as the agent will be authorized to make your fundamental health care decisions if you are incapacitated. The same individual is sometimes appointed to serve as agent for financial and health care decisions. However, this is not always the case. Each situation is different. You know the strengths (and weaknesses) of the pool of candidates for these important roles.

A living will, also known as an advance health care directive, documents your wishes when it comes to end-of-life care. It must address some hard questions concerning medical treatment: do you want your life extended through any artificial means? Would you want to donate your brain or other organs for scientific research?

You should execute a HIPAA release form, so doctors and attorneys may speak with your financial and health care agents, family members and caregivers as issues arise. In addition, those you authorize will also be able to obtain access to your medical records. This access is essential and is very practical for uses ranging from obtaining second opinions to pursuing potential malpractice claims. The HIPPA release form is also needed to interface with the health insurance provider. The right to speak with medical providers based on being a spouse or descendent should not be assumed.

Trusts are Commonly Used to Manage Assets for Incapacity Planning

You can create a fully-funded revocable living trust to address the management of your assets while you are living and to distribute your assets postmortem according to your instructions. As long as you have capacity, you are in charge as the original trust and beneficiary. You can even make any changes you desire. Upon your incapacity, the trust becomes irrevocable and continues to provide for you. Only upon your death does your trust become irrevocable, since it carries out your distribution instructions. The successor trustee you appoint can be the same person appointed as the agent under your POA, the executor under your last will and even your health care agent.

Planning for Final Arrangements

It is wise to discuss whether you want to be buried or cremated. You should also provide guidance regarding what, if any, kind of funeral service you would like and any other related arrangements. The more decisions you can make now, the fewer your loved ones will need to decide later on when grieving your loss.

Incapacity Planning for Alzheimer’s or Dementia

Planning for incapacity can be part of the process of coming to terms with an Alzheimer’s or dementia diagnosis, both for you and your loved ones. Memorializing your wishes helps keep you in control of the process, since your wishes are expressed and documented. You and your loved ones will be empowered to move forward with a plan in place.

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