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Make sure 'big three' documents are in order

Dear Carol: What paperwork do we need to have in order to guarantee that our son can handle our financial, legal and medical affairs when we can't? What about the new HIPAA laws? - Marie...

Dear Carol: What paperwork do we need to have in order to guarantee that our son can handle our financial, legal and medical affairs when we can't? What about the new HIPAA laws? - Marie

Dear Marie: I asked Brenda Rosten, of Rosten Law Office, to help us out. Brenda concentrates on estate planning and elder law.

"Most people should have what I call the 'big three': A power of attorney, a health-care directive, and a last will and testament. These three documents are instrumental in managing a person's affairs during their lifetime and in distributing their assets after death.

"A power of attorney authorizes another person to act for you in the event you cannot act for yourself. Typically, this document is broad in scope, allowing another to access your funds and handle your other financial, legal and personal affairs. You do not have to be 'incompetent' for your agent to act for you - your agent can act on your behalf if you are unavailable (for instance, if you are too ill to sign or are out of the country).

"A health-care directive (or a power of attorney for health care) is similar, but the authority to act is limited to medical decisions. Generally, as long as you are competent, your health-care agent cannot override your decisions, as this person is only able to act when you are unwilling or unable to act.

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"In 2005, the power of attorney for health care and living will were merged into one document in North Dakota. Minnesota had this in place earlier. If someone has one of these two North Dakota documents, signed before Aug. 1, 2005, he or she may not need to sign a health-care directive, as their old documents are still valid under state law. However, these older documents should be carefully reviewed to be sure that they include HIPAA (Health Insurance Portability and Accountability Act) compliant language - otherwise the document may appoint someone to make health-care decisions for you, but not give that person authority to talk to your doctors or review your medical records!

"It is important to remember that the authority granted in these documents terminates automatically upon your death.

"At your death, your last will and testament will nominate a personal representative who will wind up your business and affairs by collecting your assets, paying your debts and distributing your remaining assets as laid out in your will. This personal representative has no power or authority to act for you while you are still alive."

Each of these three documents serves a different purpose, so it is wise to have all three of them in place. As long as a person is competent, he or she is able to sign, change or revoke these documents.

"These documents should be reviewed with an experienced estate planning attorney when the law changes and when major life events occur, such as deaths in the family, marriages, divorces and significant changes in assets."

The phone number for Rosten Law Office is (701) 364-0154. She is licensed in North Dakota and Minnesota.

Bursack is the author of a support book on family elder care. To submit questions to "Minding Our Elders" and view past columns, go to www.in-forum.com and click on columnists. Readers can reach Bursack at cbursack@forumcomm.com or write her at The Forum, Box 2020, Fargo, ND 58107.

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