NEW ILLINOIS POWER OF ATTORNEY ACT PROVIDES MORE PROTECTION AGAINST MISUSE

July 29th, 2011 | written by Nancy Larson

Due to recent changes in the law, this is a great time to review your existing estate planning documents, particularly your Powers of Attorney. It is so important that each of us take the time to execute a Property and Health Care Power of Attorney to ensure that our wishes are honored and carried out on our behalf if we become disabled or incapacitated.  With that, you should carefully consider the appropriate agent to appoint who you believe will honor your intentions when you are no longer able to communicate your desires.

Now, let’s get down to business.  The new Illinois Power of Attorney Act for Property and Health Care is hot off the press and became effective July 1, 2011.  The purpose behind the major overhaul of the Act was to make the power of attorney forms more user-friendly, and at the same time provide additional protections from financial exploitation through the Property Power of Attorney and physical abuse through the Health Care Power of Attorney.

Under the Property Power of Attorney, the new law creates a higher standard of care for the agent appointed.  Specifically, the agent once exercising their power, shall use due care, competence, diligence and act in good faith for the benefit of the principal.  Also, the agent must act in accordance with the principal’s expectations and not its own.  The agent is required to keep a detailed record of all receipts and disbursements, including significant actions taken on behalf of the principal.  At any time, the agent can be required to provide copies of their transactions upon request from the principal and other significant representatives, including heirs of the principal. Failure to uphold this new standard of care could cause an agent to become liable to the principal or the principal’s successors in interest to restore the lost value of property.  For this reason, the new law requires that a notice be given to the agent describing the agent’s responsibilities before the agent accepts the appointment!

Under the Health Care Power of Attorney, the changes to be aware of include language to address the Health Insurance Portability and Accountability Act (HIPAA) and the Disposition of Remains Act.  If you have been to a doctor in the last few years, you would have been asked to sign a HIPAA form.  That form acknowledges the requirement that the doctor’s office must keep your identifiable health information private and that only certain individuals can access your medical records.  The new Health Care Power of Attorney form now includes the HIPAA language and grants your agent the authority to access your health information and this authority.

Additionally, the new Health Care form incorporates recent changes to the Disposition of Remains Act. Your agent is granted the power to authorize an autopsy and make decisions regarding the disposition of your remains, including cremation and/or funeral arrangements.  Lastly, it attempts to clarify your preferences regarding the withholding or removal of life-sustaining treatment.

Another new addition to the law for both Property and Health Care Powers of Attorney are the prohibition of certain individuals signing as a witness to the principal’s execution of their Power of Attorney documents.  It is a conflict of interest for doctors, mental health providers, owners and operators of a healthcare facility where the principal is a resident, family members, a named agent or successor agent, or any relatives of the individuals listed to serve as a witness.  Another layer of protection to avoid undue influence is the new requirement for a second witness to attest to the principal’s signature.

It is to everyone’s benefit to take a moment to contact a local estate planning attorney and schedule an appointment to update existing powers of attorney – or get some initial documents in place – to ensure that your wishes will be carried out on your behalf if and when you are not able to.

 (Submitted to BND, July 29, 2011)