The acronym HIPAA stands for the Health Insurance Portability and Accountability Act of 1996. In this post, we will demonstrate why this piece of legislation is something to consider when planning your estate.
Advance Directives for Health Care
Even though most people are aware that you have to facilitate postmortem asset transfers when you put your estate plan in place. A lot of people might not realize,that a proper estate plan addresses eventualities that you may face toward the end of your life.
Nobody likes to think about this type of thing, however people usually do not pass away without experiencing a period of incapacity in one form or another. It can be cognitive or physical, and people that are on strong medication can become unable to communicate sound decisions.
To account for these possibilities, your estate plan should include documents called advanced directives for health care. One of them is a living will.
With this type of will, you state your wishes with regard to the use of feeding tubes, artificial hydration, resuscitation, and mechanical ventilation.
The other advance directive that is necessary is a durable power of attorney for health care. This document is used to name someone to act on your behalf in the event you become unable to communicate your own decisions. These would be matters that are not covered in the living will.
Now that you know the incapacity planning component, let’s look at the Health Insurance Portability and Accountability Act. This legislation prohibits medical professionals from sharing information with anyone other than the patient.
Obviously, your health care agent would not be able to do the job without access to this crucial information. Your incapacity plan should include a HIPAA release to give the doctors the ability to communicate freely with your agent and anyone else that you choose to add.
I should also point out the fact that HIPAA protections extend to all adults, even people that just turned 18. Consequently, if you have an 18-year-old child, doctors would not be able to discuss their medical condition with you.
Because of this, if you are a parent, you should explain the situation to your young adult child so they can sign one of these forms. They can also make you the agent under a durable power of attorney for health care.
Financial Decision Making
Your incapacity plan should also address the financial part of the equation. If you have a living trust, you would act as the trustee while you are alive and well. To account for possible incapacity, you can name a disability trustee when you establish the trust.
For property that is not held in the trust, you should execute a durable power of attorney for property. You can use the same person to act as the agent for both powers of attorney, but this is not a requirement.
Need Help Now?
If you have learned enough to know that it is time for you to put an estate plan in place, our doors are open. You can send us a message to request a consultation appointment, and we can be reached by phone at 504-831-2348.