HIPAA – What’s That?

HIPAA stands for the Health Insurance Portability and Accountability Act.  It created privacy rights about your medical records. You will encounter its effects if you are in a serious accident and can’t consent to access to your medical records so that your family and your doctors can decide on the best treatment. By virtue of the HIPAA law, hospitals, doctors, nurses, and health insurers cannot release your medical records to other hospitals, doctors, nurses or your family without your authorization. Or if your parent has a heart attack or a stroke that is unexpected, if you do not have the proper documents, the doctors and nurses are not permitted by HIPAA to discuss your parent’s medical situation with anyone else, even you or your siblings.

You will even need a HIPAA Release Form in non-emergency situations. My aunt was recently hospitalized with a heart problem. She wanted her hospital records sent to her family doctor so the doctor could evaluate what the hospital had done. The hospital was taking forever to send the records so she asked me if I could call the hospital and get them to forward her medical records. Of course, they would not speak to me until they had a written authorization from my aunt in their hands.

Many health care proxies and advance care directives that were signed awhile ago will not be helpful if the health care provider insists on maintaining your medical privacy. You need to have specific language in the health care proxy allowing your agent to see your medical records.

Make sure to contact an attorney who specializes in estate planning for exact details on your specific situation. I can’t imagine what it would be like for you, if your loved one was seriously injured or dying, to be denied information about her condition.

 

Estate Planning When You Remarry

The traditional nuclear family is not in the majority in the United States in the 21^st century. You are more likely to be part of a blended family due to remarriage after being divorced or widowed than you are to be part of the traditional nuclear family. Estate planning is different if you are remarried. Here are some issues you should be aware of.

If there are ex-spouses in the picture, you should make sure that they are disinherited. This means that if either ex-spouse is on a deed, bank account, retirement account as a beneficiary, or life insurance policy, the ex-spouse’s name must be removed. This must be done even if your will states that everything goes to your new spouse or your children.

 

When there is a typical nuclear family, the estate plan usually provides that the spouse will have access to all of the assets. If both spouses die simultaneously, the estate typically goes to the children. With a blended family, each spouse may have a different estate plan. If you have children from your previous marriage, you usually want your biological children to inherit some, if not all, of your estate. You may also want your biological children to inherit your personal possessions (your jewelry, family heirlooms, furniture that has been in your family for generations). If you want your children to immediately inherit your estate, you must have your will drafted to reflect that wish. Of course, if your children are still minors, you want their inheritance to be left to a trust. But remember that if you don’t have a will, your children’s inheritance will be supervised by the court and your ex-spouse, as guardian of your children, will have control over your children’s inheritance. If you wish to leave your estate to your children, your will should state that your assets will be transferred to a trust of which they are the beneficiaries and someone other than your ex-spouse is the trustee.

If you wish to leave some assets to your new spouse while he is alive, your will could create a trust for the benefit of your spouse. The trust could then benefit your children after your spouse’s death. But without a properly drafted will, your entire estate could go to your spouse and your children could get nothing.

If you blended your assets with your new spouse and everything is in a joint account, you don’t have an estate at all. Everything that is jointly owned goes to the surviving joint owner, regardless of what your will states. Then, it could all go to your new spouse and his family. Is that what you wanted?

There is no one standard estate plan that will allow you to transfer your wealth to your children, your new spouse, and the children of your new marriage. You should consult an estate planning attorney who will listen to your wishes and craft a plan that carries out those wishes.

 

What Happens to Your Children if Both of You Are Severely Injured

You go out to dinner in town. On the way home, your car is hit by another car. Both of you are unconscious and taken to the hospital. Do you have a plan for your children?

If you are one of the smart ones, you have wills that are actually signed (not just the drafts that you were supposed to review). Your wills name a guardian that you spent much time and agony deciding on. But that guardian may live in another state and is not legally the guardian because you are not yet dead. What have you planned if something goes wrong before you get back from dinner?

If your children are small and there is a babysitter, you must leave telephone numbers of relatives, friends, or neighbors that a babysitter can call if she can’t reach you and it is much later than you said you would be returning. You should have a signed document in your house authorizing that relative, friend or neighbor to have temporary custody of your children in the event of emergency. You should be carrying something in your wallets that emergency personnel can act on, a card with the name and telephone number of someone to call if you are unconscious. Emergency personnel are trained now to check cell phones for the ICE number on your contact list. ICE stands for In Case of Emergency and you should have the phone number of the person who will have temporary custody of your children listed as your ICE contact. Finally, the person who you have designated as the temporary guardian should be aware that he/she may get that phone call and have some idea of what you would want him/her to do until you can talk to him/her.

If your children are old enough to be left on their own without a babysitter, then they must be left with names, telephone numbers and instructions of who to call and how to proceed if you do not come home that night.

It’s a horrible thought that this scenario (and others like it) may happen to you. But just read the newspaper or listen to the news and you will hear of car accidents, plane crashes, and other bad things happening to other people. What would happen if bad things happened to your family? Do your planning now.

What does a trustee do?

Trusts are a very popular topic in estate planning. There are seminars all over the place, urging you to put all your assets in a trust. Your estate planner may suggest that your will provide for various trusts, with different purposes.

Assuming you have decided that you need one or more trusts, you need to decide on who will be the trustees, the persons who will safeguard and manage the trust assets. If the trust is a revocable living trust, created while you are alive, you will probably be the trustee. But if the trust will not come into existence until you are dead, you should consider what a trustee’s duties are before choosing the trustee.

Trustee have oversight and management of the trust assets. They will keep track of the income earned by the trust, have the responsibility of investing the assets in the trust, and keep and accounting of all financial activity for the benefit of the trust’s beneficiaries. The details of what a trustee is allowed to do are defined in the trust document. If the trust says that assets are not to be invested in certain types of investments, then the trustee cannot do that investment. If the trust agreement is silent on a power of the trustee, then the trustee does not have the power to do that activity. Sometimes state law creates certain responsibilities in the trustee and dictates how the trustee will act.

Of course, the trustee can consult with financial experts who can give him some guidance about how to invest and manage the trust assets. The trustee can also hire accountants and attorneys to give advice and prepare the trust tax returns.

Certain persons will not be suitable to act as trustee because of the nature of the work involved. You want to pick someone who has the time to act as trust, who knows how to manage assets, and who will be prudent in managing those assets.