A power of attorney (POA) is a legal directive that gives someone else the authority to act on your behalf – and they’re commonly used in estate planning for end-of-life management. You might, for example, empower your son or daughter to make medical decisions for you when you cannot speak for yourself, handle your finances, or both.
However, not all POAs are the same. A “springing” power of attorney, which only goes into effect when a triggering event occurs, often appeals to those who want to maintain full control over their lives as long as possible – but it is not without drawbacks. Consider this:
Delays in activation can be challenging
One of the biggest issues with a springing POA is the need for more clarity surrounding what constitutes a triggering event and how it is determined. Drafting a springing POA can be difficult because it’s essential to precisely define the circumstances under which the POA will “spring” into action – and that may require the involvement of multiple medical professionals.
If the definition of “incapacity” is too narrowly construed, the grantor could be left unprotected at a critical time. If the definition of the triggering event is too broad or unclear, that could lead to subjective interpretations that lead to disputes among family members – or legal challenges.
In addition, it can be very difficult to get a formal diagnosis from a physician. Many are reluctant to declare a patient “incapacitated” in all but the most extreme circumstances because they are aware of what that might mean for their patient’s autonomy and future. They’re also aware of the possibility that they could become embroiled in litigation over a diagnosis that isn’t supported by the patient or their entire family.
This issue is particularly problematic in situations where the grantor’s condition fluctuates over time or deteriorates slowly. For example, someone in the early stages or middle stages of dementia might not meet the formal requirements of “incapacitation,” even though they gradually become more vulnerable to financial abuses and struggle to make sound medical decisions.
In general, a springing power of attorney may not provide the balance the grantor is seeking between the loss of their personal autonomy and their desire to be protected from medical or financial harm in a time of need.
There are other options available
A durable power of attorney is one of the most common alternatives. Unlike a springing POA, a durable POA takes effect immediately upon signing and remains in effect even if the grantor becomes incapacitated.
With a durable POA, there’s no need for medical verification or court involvement, which reduces delays in a crisis. The disadvantage of a durable POA, of course, is the potential for abuse. Since the designated agent’s authority is immediate, the grantor needs to choose someone that they trust deeply and completely.
It’s also possible to use a combination of revocable living trusts, healthcare powers of attorneys and living wills (advance medical directives) to accomplish the principal’s goals.
In short, there’s no “one-size-fits-all” approach to the issue of how to address end-of-life needs and incapacitation. Every option comes with its own set of benefits and drawbacks. Before you decide on a springing POA, a durable POA or any other option, it’s important to seek legal guidance that can help you make sure you are comfortable with the risks of each option and that your estate plan is structured to meet your personal goals.
