Medical and Financial Power of Attorney

Power of attorney is a legal document that authorizes the nominated person to make decisions on behalf of the person nominating him. If he is authorized to make financial decisions, it is called a financial power of attorney, while medical decisions are covered under a medical power of attorney.

Health and financial power of attorney are the top major types of POA and are widely used worldwide. Having a POA offers peace of mind as you can nominate a sound person to take over critical decisions in case you become unavailable.

Legally speaking, the person who gives the authority is called the principal, and the person who acts on behalf of the principal is called the agent or attorney-in-fact.

Moreover, you can nominate the same person for medical and financial POA or different for different decisions.

This article will examine the medical and financial power of attorney.

Financial Power of Attorney

Financial power of attorney empowers the agent to make financial decisions on behalf of the principal. These decisions could include tax payments, cash withdrawals, cash deposits, property sales, and purchases, as mentioned intoned in the POA.

Moreover, finance experts can generally act as FPOA, or you can designate a family member or friend. Further, power of attorney financial responsibility becomes effective under conditions as stated in the document.

• Working of a Financial Power of Attorney

A POA becomes effective when you sign it or upon the happening of a certain future event. If the POA becomes effective immediately, it can be used immediately without waiting for you to become incapacitated. However, if the POA is ‘springing,’ it will only become effective until a future event has occurred.

Furthermore, the major event used for ‘springing’ POA is when the principal becomes incapacitated. However, this incapacitation only validates upon certification of one or more physicians.

Likewise, if you never experience incapacitation, the agent can never use a power of attorney.

Generally, each state has a prescribed power of attorney form. On the other hand, others allow you to write it down on your own. Similarly, major states require you to get your POA notarized to make it legally binding.

Once the POA is finalized, the original document is handed over to the agent. Then, the agent can get it endorsed as evidence by presenting it to a third party. For instance, the agent can present it in the bank to withdraw money from the principal’s bank account.

Additionally, there is no prescribed procedure to revoke the power of attorney. Therefore, the best option is to cancel the existing document and prepare a new one.

• Choosing a Financial Power of Attorney

Legally, there is only one condition: the agent should be of sound mind and have attained an age of eighteen years or above.

However, choosing a financial POA is vested in selecting a trustworthy individual with prior experience handling finances. Therefore, you can also select a person from another state to act as a power of attorney for financial affairs.

• Establishing Financial Power of Attorney

Following the steps below, you can easily establish power of attorney for financial decisions.

• Evaluate if you need a POA
• Identify an agent
• Prepare forms
• Notarize the POA
• Review documents periodically

Medical Power of Attorney

The medical power of attorney is authorizing a person (agent) to make medical decisions for you if you no longer have the capacity to do so.

Moreover, any adult competent person is eligible to act as MPOA. However, few states do not allow your medical practitioner or healthcare provider, an employee of your physician, a residential healthcare provider, or an employee of your residential healthcare provider to act as your medical power of attorney.

Likewise, depending on your medical condition, you can appoint an MPOA for short- and long-term periods.

• Working of a Medical Power of Attorney

The medical power of attorney has decision power only related to health-related issues and will be written exactly in the POA. Therefore, the principal can include:

• Personal care management duties.
• Hiring personal care assistants.
• Medical treatment.
• Decisions on medical treatments.

Furthermore, many states have a prescribed form that can be used as a medical power of attorney. However, other states allow principals to use their form. Likewise, it would be best to get your POA notarized, thus making it a binding legal document.

Additionally, an MPOA written by a medical practitioner or an attorney is not required.

You can revoke your medical power of attorney anytime and prepare a fresh one to replace the revoked document.

• Choosing a Medical Power of Attorney

Many people see their health as the top priority; thus, appointing a power of attorney to look after their health becomes inevitable. However, it is vital to understand the risk and nominate the right person.

Therefore, always appoint a person who has attained the age of 18 years, is trustworthy, and with whom you can share your wishes frankly. Further, it is important to seek permission from the person being appointed as an agent.

Similarly, you can appoint a single person or multiple individuals to act as medical power of attorney. Additionally, try to choose a person who lives nearby, as he should make himself available in any emergency.

• Establishing Medical Power of Attorney

Establishing medical and financial power of attorney is similar, so you can follow the steps below to set up an MPOA.

• Evaluate your medical condition to ascertain the requirement of a medical power of attorney
• Shortlist and select whom to choose as an agent
• Find and complete the medical power of attorney form
• Have the form notarized
• Distribute the copies of the completed form among your physician, close family members, friends, lawyer

Frequently Asked Questions

Does a financial power of attorney need to be notarized?

Most states require you to get your financial power of attorney notarized. Therefore, it is better to check your local laws and proceed accordingly with the notarization of power of attorney.

Can the same person act as medical and financial power of attorney?

Yes! A single person can act as both medical and financial power of attorney. However, it is not advisable, as you must nominate the specialists to see your power of attorney, financial matters, and health separately.

Can I appoint my physician as the medical power of attorney?

No! You cannot nominate your physician or doctor as the medical power of attorney. Therefore, nominate a close family member or friend to take responsibility for your medical power of attorney.

What does a financial power of attorney do?

A financial power of attorney is required to make finance-related decisions on behalf of the principal. Generally, these decisions include selling and purchasing assets, cash deposits and withdrawals, paying taxes, and other similar tasks. Moreover, duties are limited to the tasks outlined in the financial power of attorney document.

Parting Thoughts

Both medical and financial power of attorney have a similar base but differ in the nature of decisions. In a financial power of attorney, the agent must make finance-related decisions. 

Whereas, under a medical power of attorney, the agent makes health-related decisions.

Moreover, the procedure for nomination of both POAs is similar, as you need to fill out a prescribed form by the state. However, you can also write your own POA if local law permits and get it notarized. Once done, you must submit the POA to the agent, close family members, and your lawyer.

Further, both POAs have benefits that will help you move smoothly through times when you are unavailable or have a medical condition.

However, always select a trustworthy and mentally sane person to appoint as a financial or medical power of attorney.