There has been a great deal of controversy surrounding Powers of Attorney since 2009 when major changes were made to the law, including the addition of the Statutory Gifts Rider. This is a separate document which is executed simultaneously with the Power of Attorney. The Statutory Gifts Rider allows the individual executing the Power of Attorney to state who may make gifts and asset transfers on their behalf, including gifts to the agent him/herself.
When constructing a Medicaid and asset protection plan, the agent under a Power of Attorney may create a Trust or transfer funds and/or property in order to preserve assets. In addition, when applying for Medicaid Home Care benefits, the agent under a Power of Attorney may seek to establish a Pooled Income Trust for the principal in order to preserve excess income.
The Human Resources Administration, the agency which processes Medicaid applications in New York City, has recently issued strict guidelines with regard to Power of Attorney documents that are submitted as part of a Medicaid application. Pursuant to these guidelines, the Power of Attorney may only be used to establish a Trust if that power is specifically stated and authorized in the Power of Attorney document and provided a Statutory Gift Rider is properly executed.
It is more important than ever to review your Powers of Attorney and those of your loved ones. Seek guidance from Cona Elder Law’s experienced elder law attorneys to ensure that your documents are properly drafted and executed. Discovering that Advance Directives are not proper or valid at the time of application can be extremely costly, leading to the unnecessary spend-down of assets, guardianship court proceedings and delay in Medicaid coverage.
As always, contact us if you have any questions. Our Elder Law attorneys are always available to address your questions and concerns. Call us at 631.390.5000 or click here.