The Need for a General Durable Power of Attorney

The Need for a General Durable Power of Attorney

One of the most important aspects of Medicaid planning is that there be access to assets of the applicant. If the applicant is incompetent, the power of attorney should be used to have access to these assets. The word “durable” refers to the fact that the power of attorney must have special language so that even if the applicant is incompetent, the assets can be used or liquidated.

Reference is made to Post 20 which indicates that a typical applicant might have bank accounts, securities, E bonds, IRA’s, life insurance policies and/or a residence. It is my practice to reference any type of asset an applicant may have to make sure the power of attorney can be used to liquidate such asset. However, not all companies will require that the power of attorney have language relating to the specific asset.

If an individual is not competent and there is no power of attorney or the power of attorney is not deemed to have access to the asset, a costly guardianship is required.

The power of attorney should not be pro forma (i.e. standardized). Particularly in the elder law area, the individual’s situation is to be considered in drafting the language for a power of attorney. This will be discussed further in future posts.

Generally, only a copy of a power of attorney is necessary except for real estate transactions. Also, the County Board of Social Services asks for a power of attorney as part of the application process.

It is important that the power of attorney be done as soon as possible, particularly if the individual is failing. A power of attorney can only be done if the individual is competent.


Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.


© May 2009, Post #32