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Wednesday, April 20, 2011

Legal and Financial Steps when Someone is Diagnosed with Alzheimer's Disease

By Joseph S. Karp, Florida Bar Certified Elder Law Attorney

The Alzheimer's Association and The National Institutes of Health yesterday announced a new approach to diagnosing Alzheimer's Disease. They are recommending inclusion of people with even mild memory loss that appears to be Alzheimer's-related. The rationale: Identifying the disease earlier will allow whatever any available treatments to be administered sooner, when they might be more effective.

Unfortunately, presently there is no preventive method and no cure. And that means the legal approach to the issue of Alzheimer’s Disease must remain the same: Prepare, prepare, prepare. In my Florida Elder Law practice, I help many patients and families establish the legal and financial plans necessary to deal with what is to come. These plans can help smooth out what will surely be a challenging road, and avoid unnecessary trauma. These plans must be put in place while the patient is competent. Once the patient is severly incapacitated, a costly and complicated guardianship may have to be instituted.

Below are some of the steps that should be taken when the diagnosis is Alzheimer’s:

Create a Durable Power of Attorney

A Florida Durable Power of Attorney will empower one or more people to handle the patient’s financial affairs when he/she can no longer do so.  Florida recognizes two types of Durable Power of Attorney: The contingent power gives the agent the ability to act only when the patient is incapacitated. The Immediate power allows the agent to act on the individual’s behalf as soon as the document is executed. A Florida Certified Elder Law Attorney can advise as to which type best suits the given situation.

Note that a Florida Durable Power of Attorney does not automatically authorize an agent to handle every type of matter. Specific powers must be authorized; for example, the ability to buy or sell property. One power someone diagnosed with Alzheimer’s Disease should include is the power to make gifts. This may become very important if and when the patient seeks to qualify for longterm care Medicaid benefits.

 

Create Advance Health Care Directives

Someone diagnosed with Alzheimer's Disease should establish Advance Health Care Directives. There are several types:

  • Florida Health Care Power of Attorney(also known as the Health Care Surrogate). This document empowers one or more persons to make the Alzheimer's patients medical decisions when he or she is not capable of doing so. If the patient lacks a valid Health Care Power of Attorney and is not competent to communicate his/her own wishes, Florida Statutes determine who has the power to make the decisions. A worst-case scenario may involved a court guardianship. It is crucial that the Health Care Power of Attorney include a HIPAA release.

 

  • Pre-Need Guardian Designation: It is also a good idea for the patient to name who he/she would like to serve as guardian, if for any reason guardianship must be commenced. Although the court is not bound to this request, it is heavily considered.

 

  • Living Will: This document specifies the kind of life-extending care a person does or does not want if in a terminal or end-stage condition, or in a persistent vegetative state. The Living Will can be a great comfort to family members if they are ever called on to make these difficult decisions on behalf of the patient.

 

Review titling of assets of the patient and the spouse, and consider Medicaid Planning and Veterans Benefits Planning for Longterm Care

If a patient lacking adequate longterm care insurance requires custodial nursing care in the future, the family may apply for Florida Medicaid benefits. The ownership of assets plays a large role in determining whether the patient is qualified, and can make the difference between losing and preserving assets. Also, if the patient is a veteran or the widow of a veteran, eligibility for V.A. Benefits for home care, assisted living facility or extended nursing home care should also be explored.

 

Create a Will

A Florida Will directs to whom assets are transferred upon the patient’s death. Note that the will does not direct where assets go if they are jointly held or payable on death to a designated beneficiary. It may also be advantageous for the patient to establish a Trust. A Florida Certified Elder Law Attorney can discuss which approach best suits the situation.

 

If the patient is married, review the spouse's assets and estate plan

This is a journey that the spouse takes along with the patient! The spouse should establish an estate plan to protect him/her as well as the patient. If the spouse predeceases the patient, any inheritance the patient receives may result in termination of Medicaid benefits or a period of ineligibility. If the spouse's Health Care Power of Attorney and Durable Power of Attorney name the spouse as agent, these documents obviously will need revision, too.

We are unfortunately not yet at the point where Alzheimer’s Disease can be prevented, or cured.  We do however have the tools to minimize the legal and financial disruptions that ensue.


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