Resolve Your Medical and Financial Future

Physician's Money Digest, November 2005, Volume 12, Issue 15

As our population continuesto age, physicians,like everyone else, arebeing forced to designatehow decisions will bemade for themselves in the future. Sincemost seniors become incapacitatedsometime before their death, it is veryimportant to plan for the long-term careof you and your loved ones. Legallystating your desires and choosing someoneto make medical and financial decisionson your behalf are important mattersto include in estate planning. Thereare several documents physicians needto consider should they or anyone intheir family become incapacitated:

Cruzan v

Director, Missouri Department of

Health

•Living will. A declaration that aperson does not desire life-sustainingtreatment if there is no significant hopeof recovery, a living will should alwaysbe part of an estate plan. Make surethat your existing living will explicitlystates the withdrawal of nourishmentand/or hydration if this is what youwish. In the 1990 case of , the US Supreme Court ruledthat to be taken off life support (includingintravenous nourishment and fluids),you must have this declared beforebecoming incapacitated.

•Health care power of attorney.Also called a medical power of attorney,this document grants someone youtrust (ie, an agent) the power to makemedical decisions, including the withdrawalof life support, on behalf of you(ie, the principal). You should nametwo or three successors just in case yourappointed agent cannot serve this role(eg, you and your spouse are in thesame accident). A health care power ofattorney ensures that the family, notphysicians, has the final say in treatment.If it is clear that life cannot besustained, the living will takes effect.

•Durable general power ofattorney. A durable general power ofattorney grants the agent the right tohandle property and income decisionseven after the principal becomes incapacitated.Unless a power of attorneyis durable, it becomes ineffective oncethe principal becomes incapacitated.In many states, a springing power ofattorney becomes effective only uponthe incapacity of the client. Using apower of attorney in lieu of guardianshipcan reduce the expense (eg, bondcosts and attorney fees), time delays,court oversight, and transactionrestrictions existing on guardians.Because many states have adoptedspecial provisions for powers of attorney,make sure your power of attorneyis in full compliance with applicablestate law.

Perhaps the most frustrating andtime-consuming aspect of dealingwith the incapacitation of a familymember is the lack of necessary information.Because most people do notplan for end of life, families lack thenecessary information and ability tomake important decisions about medicalwishes, assets, liabilities, andfuneral arrangements.

Parents should discuss these issueswith their children or other familymembers. In fact, the greatest sourceof post-death conflict among familymembers is often the disposition ofpersonal property. During a time asdifficult as the incapacitation and subsequentdeath of a loved one, it helpsto have all appropriate documents settled.Create a notebook containingcopies of important insurance, asset,estate, and family documents, includingthe names, addresses, and phonenumbers of advisors. It is never prematureto plan.

is a managing partner of

Gotham Financial Services in New York. He

welcomes questions or comments at 212-340-1050 or 212-253-4020 (fax).

Ori W. Pagovich