After the Alzheimer’s Diagnosis: Legal Planning

1. After the Alzheimer’s Diagnosis:Legal Planning Erica Wood, Esq. Commission on Law and Aging American Bar Association National Press Foundation May 24, 2011

2. Today’s Talk … • Key steps to get affairs in order after diagnosis of serious illness such as Alzheimer’s disease • Paying for health care and support • Managing health and personal decisions • Managing money and property • Other key planning considerations • Last resort: guardianship • Get legal documents in order

3. Plan How to Pay for Health Care and Support Needs • Employer-based disability benefits • Some employers have short-term or long-term disability insurance • Social Security disability benefits • Recent SSA decision to fast track disability decisions for individuals with Alzheimer’s disease • Supplemental Security Income benefits • Means tested program by SSA • Veterans benefits • Broad array of financial benefits

4. Plan How to Pay for Health Care Needs • Medicare • Primary payer for individuals with Alzheimer’s disease; eligible at 65 or after 24 months on SSDI • Private health insurance • Employer-based or private insurance • Long term care insurance • Medicaid • Federal/state program for low income individuals and children • Each state’s program is different • Veterans benefits • Broad array health care benefits, including long-term care benefits and nursing home care

5. Managing Health & Personal Decisions • • At some point, someone else will have to make health care decisions for an individual with dementia • Who will be the decision maker? • What guidance will be provided in advance? • How will it be communicated?

6. What is Surrogate Decision-Making?

7. Families decide (Devolved/Default) Courts decide (Displaced) Individual (Directed) Others designated by individual (Delegated)

8. Health Care Advance Directives • In the 1970s -1980s, states generally enacted multiple laws: Living Will, Health Care Powers of Attorney with overlap from consent laws. • Today about half the states have combined/ comprehensive Advance Directive laws • But still much variation in detail, especially focused on forms.

9. Types of Advance Directives • Living Wills – • Directive that provides guidance or instruction about the care and decisions wanted • Usually includes specific instructions on life-sustaining conditions • Power of Attorney for Health Care • Choose an agent/proxy (and successor) to make health care decisions if unable to make them • Should be someone who can be a strong advocate and willing to make difficult decisions

10. What ADs Can Do • CAN be an important part of a communication process in “advance care planning” • CAN help you stop and think and DISCUSS. Less about specific medical decisions, more about GOALS, VALUES & PRIORITIES: • CAN empower and give direction if reflective of the patient’s voice. Not the legislature’s canned language.

11. What ADs Can’t Do • Can’t provide cookbook directions. • Can’t change fact that dying is complicated. • Can’t eliminate personal ambivalence. • Can’t be a substitute for Discussion. • Can’t control health care providers.

12. 30 years of Research on Advance Directives • Most people don’t do. • Hard to understand the forms. • Standard form not useful guidance. • People change mind. • Agent/proxy slightly better than clueless. • Health care providers clueless about the directive. • Even if providers know directive exists, it’s lost in space. • Even if in the record, it’s still lost in space.

13. Communication is Key to Advance Planning • Not every medical decision can be anticipated • Communicate wishes, quality of life goals, values and priorities that are important • Discussions are difficult but most important for loved ones and the individual with the disease

14. Guidance for Health Care Agents, Proxies • Steps in making medical decisions • Working within health care system • Addressing disputes • Special challenges in medical decisions

15. “Advance Care Planning” • Less focus on formal instructional documents • Legal focus primarily on naming a proxy • Discussion oriented (with proxy, family, health care providers) • More broadly focused on goals + values, spiritual questions, family matters • Less treatment focused, more on quality of life • Conversion of goals to a portable plan of care: POLST if available

16. POLST – Why It Is a Sea Change • Last 30 years: standardizing patient communications – • statutory advance directives • POLST Paradigm – standardizing physicians EOL orders in order to implement patient’s goals of care. Focus on here and now, high probability crises. • POLST – requires: • Find out patient’s wishes re: CPR, care goals (comfort vs. treatment), antibiotics, N&H. • Translate into doctors orders on visually distinct (bright pink) med file cover sheet. • Ensure form travels with patient. At least 12 States have a version of POLST: CA, HI, ID, MT, NY, NC, OR, TN, UT, VT, WA, WV

18. Default Surrogate Laws(Family Consent) • Range/Priority of Surrogates • Scope of Decision Making Authority • Triggers/Pre-conditions • How Disagreements are Handled • Close Friend and Unbefriended Patient • Summary chart: • http://new.abanet.org/aging/Pages/StateLawCharts.aspx

19. Make a Plan to Manage Money & Property • Planning for management of affairs while alive helps maintain control to the greatest extent possible • Variety of legal tools • Powers of Attorney • Representative Payee • Joint bank accounts • Inter-vivos or Living Trusts • Advantages and disadvantages of each

20. Powers of Attorney • For property • Durable – since planning for incapacity • Document by which one person (“principal”) gives legal authority to another (“agent”) to act on behalf of the principal. • Generally must be signed & notarized. • Governed by state law

21. PoA Advantages/Disadvantages • Promotes autonomy – puts you in drivers seat • Avoids guardianship • Cuts costs • Helps family members • Lack of monitoring • Unclear standards for agent conduct • Lack of awareness of risks • Broad decision-making authority

22. Types of POA Abuse • In creating of the POA (power given, not taken) • Incapacity at execution • Forgery/Fraud/Misrepresentation • Undue influence • Implementing POA (agent is a fiduciary) • Transactions exceeding intended authority • Transactions conducted for self-dealing • Transactions contravening principal’s expectations

23. “Brooke Astor’s Son Guilty in Scheme to Defraud Her” • Wealthy NY socialite Brooke Astor, Alzheimer’s, age 105 • Estate more than $180 million • Son served as power of attorney • Gave self unauthorized raise of $1 million • Other counts of financial exploitation • Neglected mother’s care while enriching self • Exemplifies financial • elder abuse

24. Build Protections into DPA • Choose someone you trust • Limit gifting powers • Require co-signatory on important transactions • Require periodic accountings • Revocable as long as still have capacity • Seek advice of attorney to customize & ensure meets state law requirements

25. Uniform Power of Attorney Act • Clear statement of agent’s duties • Act in accord with principal’s expectations, best interests • Stringent requirements for exercising “hot powers” likely to dissipate property or alter estate plan • Third party refuse to honor if suspect abuse • Liability of agents who commit malfeasance • See www.nccusl.org .

26. Other Options • Joint Bank Accounts: pros & cons • Provides easy access to funds to pay bills • Joint owners have complete access to all funds • Funds may be available to pay joint owner’s debts • Upon death surviving joint owner may become sole owner regardless of will • Inter-vivos or “Living” Trust: pros & cons • Legal arrangement created by contract • Holds property for the benefit a person or persons • Can provide for management of assets during incapacity, avoid probate and provide for care of minors or disabled persons • Can be expensive to draft, to transfer property into the trust and to pay a professional trustee (if used)

27. Other Options • Representative Payee • If receive SSA, civil service, railroad retirement, VA benefits, agency may require individual to be appointed as a representative payee • Once appointed, the rep payee has authority to manage the relevant income -- but not other income or assets. • Rep payee may have to file an annual report (SSA)

28. Other Key Planning Considerations • Develop succession plan of a business • Including power of attorney to run a business and buyout agreements • Consider other public benefits, if appropriate • Including food stamps, state prescription drug benefit programs, energy assistance • Prepare will • Legal document that provides for distribution of some or all property at death • If a single parent of a minor or disabled child, can designate a guardian of the child • Plan for care of Dependents • Nominate or appoint a guardian for minor/disabled child • Arrange for financial support for minor/disabled child

29. Guardianship • Individual (or agency) appointed by court (probate, general jurisdiction) . . . . • With power and duty to make personal and/or financial decisions . . . . • On behalf of another person . . . • Whom court determines lacks decisional capacity. • Terminology – “guardian” “conservator” and more

30. Guardianship: A Double-Edged Sword • Parens patriae roots of guardianship • Guardianship “unpersons” individual (Associated Press, 1987) • Loss of fundamental rights • Inherent Tension • Between rights and needs • Between autonomy and beneficence • Between self-determination and protection

31. 51 State Guardianship Laws; Variability in Practice

32. How is a Guardian Appointed? • “Any person” files petition • Notice, possible appointment of counsel, “guardian ad litem,” court visitor • Hearing • Judicial order – “plenary” or “limited” • Bond

33. Principle of Least Restrictive Alternative • Growing use of alternatives to guardianship • Representative payee • Power of attorney • Trust • Supports such as money management • Guardianship as LAST RESORT • Enactment of limited guardianship provisions • Use of “substituted judgment standard of decision-making”

34. Guardian Accountability – Who Guards the Guardians? • Reports & Accounts • Protection of Assets • Court Review of Reports & Accounts • Investigation,Verification & Sanctions • Guardian Training/ Assistance • Funding for Monitoring • Guarding the Guardians: Promising Practices for Court Monitoring, AARP/ABA (2007)

35. Get Legal Documents in Order • Collect all important legal documents • Including birth certificate, citizenship papers, advance directives, power of attorney, trust documents, will and more • Store important legal documents in a safe and accessible location. • Let people know where the important documents are kept

36. Conclusion • When faced with diagnosis like Alzheimer’s disease, its critical to get financial and legal affairs in order. • Communicate with family, close friends and trusted legal/financial advisors. • Understanding options and making informed decisions can help maximize control and minimize anxiety at a difficult time.