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Elder Law FAQs

1. What is elder law?
A. Elder Law encompasses many different fields of law. Some of these include:

Preservation/transfer of assets seeking to avoid spousal impoverishment when a spouse enters a nursing home
Medicaid
Medicare claims and appeals
Social security and disability claims and appeals
Supplemental and long term health insurance issues
Disability planning, including use of durable powers of attorney, living trusts, "living wills," for financial management and health care decisions, and other means of delegating management and decision-making to another in case of incompetency or incapacity
Conservatorships and guardianships
Estate planning, including planning for the management of one's estate during life and its disposition on death through the use of trusts, wills and other planning documents; accomplishing your personal and family goals and easing the management of your financial and legal affairs, as well as minimizing taxes if your estate is large enough for taxes to be of concern
Probate Administration and management of trusts and estates
Long-term care placements in nursing home and life care communities
Nursing home issues including questions of patients' rights and nursing home quality
Elder abuse and fraud recovery cases
Housing issues, including discrimination and home equity conversions
Age discrimination in employment
Retirement, including public and private retirement benefits, survivor benefits and pension benefits
Health law
Mental health law

2. Do all elder law attorneys practice in all areas of elder law?
A. Most elder law attorneys do not practice in every one of these areas. So when an attorney says he practices Elder Law, find out which of these matters he/she handles. You will want to hire the attorney who regularly handles matters in the area of concern in your particular case and who will know enough about the other fields to question whether the action being taken might be affected by laws in any of the other areas of law on the list. For example, if you are going to rewrite your will and your spouse is ill, the estate planner needs to know enough about Medicaid to know whether it is an issue with regard to your spouse's inheritance.

3. Why hire an elder law attorney?
A. Attorneys who primarily work with the elderly bring more to their practice than an expertise in the appropriate area of law. They bring to their practice a knowledge of the elderly that allows them and their staff to ignore the myths relating to aging and the competence of the elderly. At the same time, they will take into account and empathize with some of the true physical and mental difficulties that often accompany the aging process. Their understanding of the afflictions of the aged allows them to determine more easily the difference between the physical versus the mental disability of a client. They are more aware of real life problems, health and otherwise, that tend to crop up as persons age. They are tied into a formal or informal system of social workers, psychologists and other elder care professionals who may be of assistance to you. All of these things will hopefully make you more comfortable when dealing with them and ease your way as you try to resolve your legal problem.

4. What is a power of attorney?
A power of attorney is a document authorizing someone else (your agent) to act on your behalf (the principal). The purpose of giving someone such a power in connection with your estate planning is to enable the agent to act on your behalf when you cannot act for yourself. A power of attorney prepared by an elder law attorney will typically contain special provisions allowing your agent to engage in Asset Protection Planning and Public Benefits Plannings on your behalf, including the ability to make unlimited uncompensated transfers in an effort to protect your assets from the forced liquidation that might otherwise be required if you were to enter a nursing home.

5. Who can create a power of attorney?
A. Generally, any individual can create a power of attorney if over 18 years of age, a resident of the state in which it is created, and legally competent. This, however, varies from state to state.

6. Who may act as an agent under a power of attorney?
A. In general, an agent may be anyone who is legally competent and over the age of 18. Usually, it is a family member such as a spouse or a child. More than one person can be named as an agent. However, sometimes naming two or more individuals to act together can prove inconvenient, particularly if a power of attorney must be exercised promptly. A better course is to name one individual as agent and then another as an alternate

7. What is the difference between a general and a limited power of attorney?
A. A general power of attorney authorizes your agent to do almost everything on your behalf which you could do for yourself. A limited or special power of attorney authorizes your agent to perform only certain acts specifically listed in the document.

8. How does an agent use a power of attorney?
A. Your agent presents the power to the other party involved in the transaction and signs any necessary documents needed for such transactions on your behalf. Your agent signs "Your Name, by His or Her Own Name, Attorney-in-Fact for Your Name."

9. What are the formalities of signing a power of attorney?
A. Requirements vary from state to state, but in Virginia signing the power in the presence of a notary is necessary.

10. When does a power of attorney become effective?
A. This depends upon what the power says. It can be made effective at the time of signing or it can become effective at the time of your incapacity.

11. What is a "durable" power of attorney?
A. All powers of attorney done in connection with estate planning are "durable." A durable power of attorney is simply a power of attorney that remains effective even if you become incapacitated. Generally, unless the power of attorney document specifically indicates it is durable, it is not durable and will terminate upon your incapacity. A non-durable power of attorney would, of course, be useless in connection with estate planning or disability planning.

12. Should I have a general power of attorney?
A. Yes. Everyone doing estate planning should execute a durable general power of attorney for financial, property, and legal affairs. This document is also often used in conjunction with a revocable living trust to enable your agent to transfer your assets into your trust in the event you become disabled. A general power of attorney can be made effective immediately upon being signed or can become effective at the time of your incapacity, which is also called a "springing" power of attorney.

13. What is the main reason for having a general power of attorney?
A. A general power of attorney is a much better way to deal with incapacity than a guardianship or conservatorship. If you become disabled, A general power of attorney authorizes your agent to act on your behalf and sign your name to financial and/or legal documents. Having a general power of attorney will generally avoid the need to go through the time consuming, expensive, and publicly embarrassing process whereby someone has to go to court to have you declared mentally or physically incompetent and then seek appointment to serve as your legal guardian and/or conservator subject to ongoing court supervision.

14. Should I have a power of attorney for health care?
A. Yes, it is equally important to have a health care power of attorney, to make decisions with respect to your medical care in the event that you are physically or mentally unable to do so, as certified by two physicians. This document includes the type of provisions that used to be in what was commonly called a "Living Will," allowing you to indicate your wishes concerning the use of artificial or extraordinary measures to prolong your life artificially in the event of a terminal illness or injury. You will also use this document to indicate your wishes with regard to organ donation, disposition of bodily remains, and funeral arrangements.

15. How does a power of attorney terminate?
A. Death revokes a power of attorney. You may also cancel your power of attorney by signing a revocation. The best way to revoke a power of attorney is to destroy all copies. If the power is a non-durable power of attorney it will terminate upon your incapacity, while a durable power of attorney survives your incapacity.

16. Under a power of attorney, can my agent make a gift on my behalf?
A. Yes, but your power of attorney must specifically authorize your agent to make gifts from your assets to persons whom you would likely make gifts. This is one area in which a power of attorney prepared by an elder law attorney may be drastically different from a power of attorney prepared by an attorney who only does estate planning. The power of attorney prepared by an experienced elder law attorney will contain special provisions allowing your agent to engage in all aspects of Asset Protection Planning and Public Benefits Plannings on your behalf, including the ability to make unlimited uncompensated transfers in an effort to protect your assets from the forced liquidation that might otherwise be required if you were to enter a nursing home.

17. Must third parties honor a power of attorney?
A. There is no way to force a third party to accept a power of attorney without going to court. Many banks will require you to complete their own forms to authorize your agent to write checks on your account, so it is advisable to inquire as to whether your banking institution requires such forms that can be completed in conjunction with executing a power of attorney. In addition, the IRS generally will not honor any power of attorney that does not specify the tax matter and the tax year at issue.

18. Are there disadvantages of a power of attorney?
A. First, third parties may not recognize your power of attorney, especially if it is more than a year old. Second, it can be difficult to revoke a power of attorney, especially if your agent has given copies to third parties that have honored it. Third, the agent can reach your assets without court approval or supervision. Therefore, it is imperative that you select an agent with great care and have tremendous confidence in that individual. It is also important that you re-sign your power of attorney every year, even if you are not making any changes to the document. This way financial institutions will be much more likely to accept it when needed.

19. Are there alternatives for managing property when a person becomes incapacitated?
A. There are several. One a court-supervised proceeding referred to as a guardianship or conservatorship. This is not an appealing option to most people. One type of alternative is the use of a living trust where assets are funded into the living trust. However, a power of attorney is still essential even if you have a living trust.

20. What is a guardianship or conservatorship?
A. This is a court supervised proceeding which names an individual or entity to manage the affairs of an incapacitated person. A guardianship may also include the duty to care for the incapacitated person.

21. What are the disadvantages and advantages of a guardianship?
A. A primary disadvantage to a guardianship is that it is a public proceeding, thereby exposing the incapacitated individual to embarrassment as the details of their incapacity are discussed at length. It is also expensive, and is a restrictive procedure. In addition, there is no guarantee that the end result will be in accordance with the incapacitated person's wishes, and someone unacceptable to the incapacitated person could be placed in charge of his or her affairs. A major advantage to a guardianship is that the courts watch every move the guardian makes in relation to the assets. Some feel this provides increased protection as well as establishing the authority of a guardian as third parties must deal with the guardian due to the court's supervision.

23. Does a Revocable Living Trust provide asset protection?
A. During the lifetime of both spouses there is no asset protection provided by a revocable living trust. However, there may be some protection for the survivor after the first spouse dies. The trust can also be created to provide creditor protection for other beneficiaries of the trust.

24. What Type of Living Trusts do provide asset protection?

A. Irrevocable Living Trusts are designed to provide asset protection. Click here for information about Evan Farr's Living Trust Plus Asset Protection Trust.

25. What is a Living Will?
A. A living will, more often called an Advance Directive or Advance Medical Directive, is a document normally incorporated into a Medical Power of Attorney in which you give directions for life sustaining treatment should you become unable to communicate your wishes.

26. Why is a Living Trust usually better than a power of attorney?
A. A Living trust is often recommended to clients as the key document in their estate plan. One reason for this is that the living trust is normally the best method for managing assets during incapacity. A major advantage of the living trust over the power of attorney is that a trustee has actual title to the assets and therefore third parties must deal with the trustee as the owner. An agent does not have title and hence third parties may refuse to deal with the agent. This is a particular problem if the power of attorney was not signed in the last year, because some financial institutions refuse to honor powers of attorney that are more than a year old.

27. Why is an Irrevocable Living Trust often better than a Revocable Living Trust?
A. A Revocable Living trust only protects your assets from probate. Evan Farr's Living Trust Plus Asset Protection is an irrevocable asset protection trust that protects your assets from the cost of probate AND from creditor, particularly from the most likely creditor that we all face, which is the nursing home.

28. Why should I consider a Living Trust?

A. Not only does a Living Trust provide for the disposition of your property (like a Will), but it also offers many other benefits, such as:

Avoiding Probate During Life
Avoiding Probate Upon Death
Avoid Probate for Multiple Generations
Holding Assets for Beneficiaries Indefinitely
Avoiding Ongoing Probate
Avoiding Estate Tax (if married)
Eliminating Probate Tax
Reducing Legal and Administrative Fees
Providing Oversight by Family, not Court
Privacy

In addition, Evan Farr's Living Trust Plus Asset Protection is an irrevocable asset protection trust that protects your assets from the cost of probate AND from creditor, particularly from the most likely creditor that we all face, which is the nursing home.