Guardianship is a court process in many states, including Ohio, Illinois, Indiana, Kentucky, Arizona and Florida. The court appoints a manager for an incompetent person’s assets and/or personal care when less drastic suitable arrangements are not already in place.
The New Yorker recently published “How the Elderly Lose Their Rights,” an exposé of abuses in one state’s guardianship system. In the wake of these troubling news reports, many wonder how to avoid finding themselves or their loved ones in a guardianship and how to select and monitor guardians if guardianship is necessary as a last resort. The answer is simple: when making your estate plan, you should ask your attorney to help you plan for incompetency, too.
Ways to Plan for Incompetency
You should name an agent under a “health care power of attorney” or similar medical power that permits the person you name to make health care decisions for you if you become unable to make these decisions for yourself. You should also execute a living will to list your treatment preferences if you become terminally ill and unable to make your own decisions or are in a permanently unconscious state. In some states, the living will is a separate document from the healthcare or medical agent. And in some states, one document covers naming an agent and “living will” directions. In special cases where a person has been diagnosed with a mental illness that may render them incapacitated in the future, Ohio laws allow a mental health care directive to express preferences for their care and treatment.
Some state laws also recognize a financial (or “general” or “nonmedical”) power of attorney in which you name a person to make financial or other non-health-care-related decisions and handle your assets if you become incompetent. Typically, your power of attorney documents will nominate the people you want to serve as your guardians in the unlikely event that your affairs cannot be managed through your powers of attorney and a guardian has to be appointed for you.
Appointment of a guardian will probably be unnecessary if these documents are in place. But if one is necessary, they give the authority to persons chosen by you. A guardian will probably not need to be appointed if these documents are in place, but if one is found to be necessary, it is likely to be the person you designated rather than an unknown person or institution.
Trusts can also play an important role. You can place your assets in a trust that specifies how your assets are to be managed if you become incapacitated. Naming a trustee you select in advance can help to protect against undue influence, coercion and improper property transfers if you become incapacitated. You can customize these documents with your estate planning attorney to require your trustee or power of attorney to account to people you specify for how they are managing your affairs.
The discussion above is general and relevant state law must be consulted to address your specific needs. Contact your Taft Private Client attorney for advice on planning for your incapacity and avoiding the tragic outcomes that have received recent media attention.