In this Warner Medicaid Moments vlog, attorney Catherine Jacobs explains how durable powers of attorney function and why they are essential when planning for long-term care Medicaid in Michigan.
A durable power of attorney is a foundational estate planning document that allows a trusted individual to manage financial and legal affairs on someone else’s behalf. These documents often come into play during times of need, such as illness or incapacity, enabling an appointed agent to handle tasks like paying bills, managing accounts, selling property and signing legal documents.
Catherine outlines the different ways a durable power of attorney can take effect. Some are effective immediately upon signing, while others, known as “springing” powers of attorney, only become effective once a person is deemed incapacitated. Each approach has practical implications, particularly when timely financial decision-making is required.
She also emphasizes the importance of understanding the scope of authority granted in the document. Powers of attorney can be narrowly tailored or broadly constructed. In the context of Medicaid planning, a broad scope is often necessary. Certain actions, such as transferring assets, creating trusts or making gifts, may be critical to achieving Medicaid eligibility, and without explicit authority, those steps may not be possible.
If a power of attorney does not include these provisions, families may be forced to pursue court involvement, such as seeking a conservatorship, which can add time, cost and uncertainty to the process.
Catherine also highlights Michigan’s adoption of the Uniform Power of Attorney Act in 2024, which introduced a statutory form. While widely available, this form includes both “ordinary” and “extraordinary” powers, and individuals may unintentionally omit key authorities needed for Medicaid planning if they complete it without legal guidance.
To help avoid these challenges, Catherine encourages individuals and families to review their existing documents, understand when they take effect and ensure they include the necessary authority to support future planning needs.
Watch the video to learn how durable powers of attorney can support Medicaid planning and why proactive review is essential. More insights will be shared in upcoming Warner Medicaid Moments.
