The most important part of your estate plan isn’t about taxes, investments, gifts, or other financial issues.
The priority of every estate plan, for people of every age, is the medical care documents. These documents should be completed even if you’re still considering other issues in the plan. This critical part of the estate plan ensures your care and comfort for the rest of your life.
There are several important features. Some estate planners prepare several documents while others consolidate the elements into one document.
HIPAA Authorization. Patient privacy was enhanced under the Health Insurance Portability and Accountability Act of 1996 (HIPAA), but it also can create a barrier to loved ones who need to know about your health status.
Under HIPAA, information about you can be released by medical providers only to people you specifically authorized to receive it. Each provider can interpret the law differently, so it’s a good idea to have a document authorizing medical providers to discuss the situation with key people in your life.
The key is to be sure you execute the form and distribute copies to all your medical providers as well as the people you authorize to receive your medical information.
Living wills and advance directives. Living wills originally were simple statements such as, “If I have a terminal condition, and there is no hope of recovery, I do not want my life prolonged by artificial means.”
Though widely accepted, experience with living wills revealed them to be ineffective, and they generally are considered obsolete. Often, it can’t be said with certainty that someone has no hope of improvement. There’s disagreement over whether some types of care, including feeding and hydration tubes, are artificial life support, a means of providing comfort, or essential to helping someone recover from what otherwise would be a final illness.
To remedy the shortcomings, some estate planners draw up detailed, custom living wills. With clients they work through questionnaires, sometimes totaling sixty pages or more, of different scenarios. The client decides the decision to be made in each circumstance. There’s an example on an episode of the television show Seinfeld.
These advance directives can’t anticipate every situation. There can be disagreements about the diagnosis and prognosis. Technology and medical knowledge can change. Third parties don’t always know what a patient is feeling or experiencing, making it difficult to apply the directives.
More significantly, some studies found living wills and advance directives often are ineffective. Medical providers often don’t see the documents until after treatment has been administered. Some care providers apparently ignore the documents because they fear lawsuits. Or if one or more key family members ask for treatment, doctors often comply even if the document indicates otherwise.
At other times, providers interpret the documents one way when other providers or family members have a different interpretation.
Health care power of attorney. Because of the limits of living wills and advance directives, the common practice now is to replace them or supplement them with what’s generally called a health care power of attorney (HPOA) or health care proxy.
An HPOA gives one or more people (known as your agents) the authority to make medical decisions when you are unable to. The agents talk with medical providers to understand your situation and the options. Then, they make decisions, perhaps by consulting your wishes stated in a living will or advance directive.
Ideally, of course, the agents know you well and have a good idea of the course of treatment you would want.
The agents need to be available when decisions need to be made, so you might not want to name someone who lives some distance from you, travels a lot, or doesn’t have some scheduling flexibility.
Naming more than one agent can allow people to share the decision-making burden and ensure all factors are considered.
Some people appoint only family members. Others have concerns about their family dynamics or believe better decisions will be made if at least one trusted non-family member is an agent.
When there’s more than one agent, you need voting rules. Do you want a unanimous decision or a majority? You also might want a default rule. For example, the treatment recommended by the lead medical provider is approved unless all the agents agree to something else.
You also might want to authorize one person to make a decision when the others aren’t available and a decision has to be made. The importance of such a provision became clear during the pandemic when people were forced into isolation, became ill themselves, or couldn’t travel.
Do not resuscitate/hospitalize. It’s common for older patients, especially frail ones, to have do not resuscitate (DNR) or do not hospitalize (DNH) orders or both.
Research indicates CPR rarely helps these individuals recover and instead makes their passings violent rather than peaceful and natural. Having a DNR prevents futile CPR efforts.
The idea behind a DNH is that at some point hospitalization for every new ailment or development at best only briefly extends a person’s life without improving its quality and might reduce the quality of life.
If you have a DNR or DNH, be sure medical providers, especially emergency medical providers, see them. The documents do little good sitting in a file when first responders are making decisions.
Good practices are to have a copy on your person in a wallet, purse, or even a shoe. Some people have bracelets or necklaces with DNR/DNH on them. In many assisted living residences, they’re taped to the back of a resident’s front door or in another prominent place. Be sure others in your life know about the documents. Your regular medical providers should have copies in their records.
Most estate planners now prepare one comprehensive document, and many states now have model forms available online.
The documents have to be valid in the state where you are present at the time treatment is considered. If you spend time in more than one state or travel a lot, your documents need to be valid in all states involved, or you need separate ones for each state.
Keep in mind that most states allow a doctor or hospital to refuse to follow the instructions for reasons of conscience. So, you should discuss preferences and philosophy with your key medical providers.