Big Changes Coming to Pennsylvania Power of Attorney Laws.

Big changes are underway for anyone employing a Pennsylvania Power of Attorney document in Pennsylvania. Act No. 95, signed by the governor on July 2, 2014, is designed to curtail abuses by agents acting under a power of attorney, as well as allow some flexibility in the agent’s services to the principal. This new legislation applies to financial power of attorney documents only. Advance health care directives or mental health power of attorney documents are not affected. 

This legislation was the culmination of three years of work and negotiation by several groups including the Pennsylvania Association of Elder Law Attorneys (A division of the National Academy of Elder Law Attorneys), Pennsylvania Bar Association, the Joint State Government Commission, and the staff of Pennsylvania Senator Greenleaf and Representative Keller. 

The changes fall into three categories: 1. Changes in the form itself; 2. Changes in the agent’s duties; 3. Changes in the powers an agent may exercise under Pennsylvania laws. Some changes take effect immediately,  others will be implemented on January 1, 2015. 

Changes to the form itself:  Every power of attorney document must now be notarized and signed by two witnesses. The affidavits that accompany the document are also modified to provide a more explicit warning to the principal. For example, the principal is warned that the agent may have the power to give away all his property, or even change how his property is distributed upon death. A new mandated clause suggests that the principal should seek the advice of an attorney at law before signing the document.The acknowledgement for that the agent signs is also modified to direct the agent to act according to the principal’s reasonable expectations to the extent they are known, otherwise in the principal’s best interest. This change is important to elder law attorneys who may have to work with an agent to qualify a principal for Medicaid, VA benefits or some other program. Many times a principal will neither plan for, nor expect that her entire estate will be depleted by nursing  home costs when drafting the original document.  

The new law specifically provides that in most cases, a photocopy or electronically transmitted copy of a power of attorney shall have the same force as the original. Prior to this change in the law, the agent could be forced to produce the original unless the document itself stated that photocopies could be used in lieu of the original. 

Changes in the agent’s duties:  In return for increased immunity to anyone who relies on an agent acting under a power of attorney, outside parties may now demand more of an agent. Any outsider who can articulate a specific reason to suspect the authenticity of the document, or the power of the agent to perform the transactions taking place, may request from the agent an opinion of counsel that the document is legal and the agent is acting legally.The cost of obtaining that opinion is born in most cases by the agent. 

An agent must now keep records of all receipts and disbursements on behalf of the principal. The agent must produce financial records within 30 days if called upon by a court, or by the executor of the estate of the principal, or a guardian, governmental agency or any other fiduciary acting for the principal. 

An agent is still entitled to compensation for her duties under certain conditions. Any outside party who without good cause refuses to accept a power of attorney, is liable for civil damages, including the loss in the value of the principal’s property, proximately caused by the refusal to comply with the instructions of the agent. 

Changes in the powers an agent may exercise:  The new law contains a list of actions that cannot be taken by an agent unless those powers are expressly granted in the power of attorney document. Included in the list are the powers to make gifts; create, amend or revoke some trusts; delegate authority; disclaim property rights; and other powers too numerous to mention here. In the case of making gifts, there are additional limitations in a new section which redefines those powers. Under the new law, the agent cannot take any action which would create a conflict of interest between her and the principal, including saving funds so the agent receives a lager inheritance from the principal. The agent must expend funds necessary for another agent to act under an advance medical directive executed by the principal. So, if the agent under the advance medical directive needs funds to arrange for a copy of medical records or to hire a geriatric care manager or any similar medical need, the agent under the financial power of attorney must comply with that request. 

This is not a complete review of the new law, and additional articles will follow. If you have any questions, add them to the comments and I would be happy to answer them.

Correction, 7/14/14. Previous editions of this post indicated the law was still on the governor's desk. In fact, the legislation was signed into law on July 2, 2014 as Act 95. It modifies the existing law, and is incorporated in Title 20, Sections 5601 - 5611.

Stay well until the next post:

Bob Gasparro, Esq.

robert.gasparro@lifespanlegal.com

Criminal Prosecution of a Guardian, or Agent under a POA?

     I recently faced an Orphan’s Court delay due to a most unusual case. As some readers already know, the court usually disposes cases that take the shortest amount of time first, then reschedules other cases, and the contested matters are heard last.This day in court, it was hard to ignore a slightly annoyed judge confronting a group of several litigants. It became apparent the case at the bar of the court involved a local continuing care community, demanding an accounting from the children of a resident. 

     As the story unfolded, it seems that years ago, as is customarily done, the parents in the continuing care community listed all their assets in an application for admission. The residents have now run out of money. The owners of the continuing care community, using simple math, realized that $400,000. disappeared from the time of the initial application.The parents’ health had deteriorated; it was not clear whether the children were acting under a power of attorney, or as court appointed guardians. One thing was clear, the continuing care community was asking the court to issue them subpoenas to financial institutions, permitting them to find the missing money. They were asking for a court order compelling the children to provide an accounting, and subpoenas for the children’s financial records.

     The children were suddenly on the hook for the $400,000. missing assets. As though that was not bad enough, someone from the Attorney General’s Elder Abuse Unit and another from the county District Attorney’s Office was monitoring the case just in case they would prosecute the children for elder abuse, and theft of their parents’ money.

     The children felt the entire matter was a family affair, and the continuing care facility had no business prying into their affairs. The court felt otherwise and ordered an accounting, and re-listed the case for the issuing of subpoenas for financial records. 

      The same judge presiding over the case happened to be teaching an Elder Law continuing education class the following week. He alluded to the case, without mentioning names. He said that he does not mind when a family engages in asset protection planning, but the trouble arises when the children decide to do their own planning, without professional advice, and transfer their parents’ assets to their name. The children might find themselves under investigation for elder abuse, and face the chance of being charged with theft, in addition to any filial support obligation. The relevant Pennsylvania law is Title 18, Section § 3927.  Theft by failure to make required disposition of funds received. That section of the theft code deals with misuse of funds entrusted under a fiduciary duty. With few exceptions, the grading of the offense depends upon the value of the property misappropriated or stolen. A way to avoid any of these hazards is to consult with an experienced estate planning or elder law attorney, or financial advisor before transferring your parents' assets. The cost of a consultation is far less than the cost of defending a criminal prosecution.

Stay well until the next post,

Bob Gasparro

You May Take Steps Against Alzheimer's Today

          As an Elder Lawyer, I frequently witness the effects of Alzheimer’s. I’ve had an opportunity to attend educational sessions sponsored by the Delaware Valley Chapter of Alzheimer’s Association, by local universities and hospice agencies. I completed a six week online course sponsored by Johns Hopkins University in Maryland, and I am currently taking another six week course offered by University of Tasmania in Australia. I accompany my spouse, a gerontological nurse practitioner, at the annual meeting of her professional association, where I have an opportunity to audit some of the sessions and learn about new drugs and research projects associated with Alzheimer’s.  

          I’ve come to learn about the functions of the five lobes of a healthy brain, how they, and the hippocampus, are affected by Alzheimer’s. I learned all about nerve cells including their dendrites, axons, synapses, myelin sheaths. I’ve learned about amyloid plaques, Tau proteins, neurofibrillary tangles, and other components associated with the disease. I know about the Pittsburgh Project and how they finally found a chemical solution that will help safely locate amyloid deposits in the human brain, but still are a few years away from product development. I know about the drugs in use, the cost of those drugs, and their effectiveness.

 I would love to share some of what I have learned:

          1. Studies have demonstrated that stimulating mental activity, seems to provide some protection from the disease.The mental activity must be challenging, however, so cooking your favorite pot roast for the 100^th time will not count. Learning to speak a new language, to play a new musical instrument, new skills, card games, mentally challenging games, attending school or holding a job, do help. 

          2. Physical activity also provides some protection from the disease. When you consider the fact that our brain activity consumes up to 20% of our caloric intake, you can understand why it is important to get a good supply of oxygen and nutrients to the brain through the blood vessels. Exercise helps promote good circulation.

          3. It is true that memory gets slower with age. Part of that is because you must process more experiences when confronted with a task. Some call that “wisdom.” Hence, a twenty year old may arrive at a quicker solution to a problem, but because they have less accumulated information during their lifetime, the solution is more apt to be incorrect. That does not mean that you go brain dead as you age, it just means that it takes a second or two longer to process information. That may be important if you are driving, but will not affect your performance at most office jobs or other activities.

          4. It’s okay to forget. “Senior Moments” are perfectly normal. So you may forget where you left your keys, or forget where you parked your car, or where you left your cell phone, and that’s okay. Only if you completely forget how to start your car, or how to use your cell phone, should you have serious concerns. 

So, keep learning and stay active. It is not a 100% guarantee but it moves the odds in your favor. Another thing you might consider doing is help fund research. I expect to attend the 2014 Walk to End Alzheimer's next November 9, 2014, in Philadelphia, and you can sign on as one of my supporters any time before the walk. 

Bob Gasparro

Pennsylvania Nurse Practitioners Organize for Laws Designed to Expand Their Scope of Practice

      Pennsylvania Nurse Practitioners are scheduled to visit the state capital en mass, on Tuesday, April 29, 2014 to speak to elected representatives about expanding primary care in Pennsylvania. 
 

     There is a critical shortage of primary care physicians in our country, and this is having a disturbing effect on seniors in Pennsylvania.  AARP, Forbes, and other commentators mentioned later in this article have proposed that the void be filled by Nurse Practitioners and Physician Assistants. One study  by the Institute of Medicine and the National Research Council reports that, when compared to 16 other high income countries, Americans not only die younger but have poorer overall health.They traced that disparity to a number of causes, including the fact that Americans have "more limited access to primary care."

     As more citizens receive medical benefits because of the Affordable Care Act, and as the number of seniors continues to increase up to the year 2047, one might expect the problem to go from bad to worse. An article in the Spring, 2013 Journal of the National Academy of Elder Law Attorney suggested medical care in the future will become so scarce, that the success of the Elder Law office a few years from now will depend on the ability to connect clients with health care. 

     Pennsylvania Senate bill 1063 of 2013 would allow nurse practitioners to operate independently, thereby easing the shortage.This is not too dramatic a change from today’s situation. An increasing number of people visit a  CVS Care Center or a Minute Clinic or Now Clinic for help with a health problem. In that setting, you are seen by a nurse practitioner. Although, in Pennsylvania, the nurse practitioner is supposed to be working in collaboration with an M.D., you will never see, nor speak with, an M.D. during your visit.  The collaboration is a mere formality. The same events are taking place where large corporations are hiring a nurse practitioner to staff a clinic at the place of employment. While a very good idea, the only problem with this approach is that the company must be able to pay both the nurse practitioner and the physician. 

     The purpose of the new legislation  is to avoid the need for a physician to get involved. As you might expect, the American Medical Association is opposed to giving patients the choice to decide for themselves, stating the additional experience of an M.D. is required. One group, the national Institute of Medicine, an independent panel that advises the federal government, hit the nail on the head when they said  that many states' regulations on nurse practitioners were "overly restrictive" and based on politics. The Federal Trade Commission issued a report that was in agreement with most everyone else, that restricting the practice of Nurse Practitioners is bad for the public. It would seem that most of us are capable of deciding whether we want to visit a nearby hospital emergency room or a nearby “Minute Clinic” or other health care clinic staffed by a nurse practitioner. You still have a choice who to visit.

 

     If the law is passed, then Pennsylvania would join the 16 other states and the District of Columbia that allow NPs to practice "completely independently of a doctor and to the full extent of their training -- i.e., diagnosing, treating and referring patients as well as prescribing medications."  Alaska, New Hampshire, Oregon and Washington were the first states to adopt broader licensing authority in the 1980’s to increase the supply of primary care providers. Other states followed in the 1990’s, so there is plenty of evidence about the efficacy of the idea. The states that allow the expanded use of Nurse Practitioners do not experience any worse outcomes than the states with the restrictions.

     Even though some elected officials in Harrisburg side with the A.M.A., guess what? Our elected officials use the clinic in at the Capitol manned by a Nurse Practitioner, without a physician in site, and it does not seem to bother them. It seems silly for them to say it’s okay for them, but not for us. 

     Some publications, like this report from The Health Economist, published at the University of Pennsylvania, feel the change is inevitable and the delay is only to protect turf and money. 

     The stance of the A.M.A. seems silly in light of the fact that the nurse practitioner will refer to M.D.'s who specialize in a particular field. As the spouse of a nurse practitioner, I can say that one of the countless benefits I receive is that she finds an appropriate specialist for my needs, and that has been an enormous benefit to my health. Like most people,  would have no idea where to start on my own, nor what specialist to see.

     I strongly suggest you call your elected representative and ask them how they feel. If they feel okay, it may be because they have access to the primary medical care their constituents want too. Let them know you want to have the choice of deciding whether or not you want to see a nurse practitioner rather than wait several weeks, or visit a hospital emergency room, for primary care. 

     In honesty, some of our local officials in Philadelphia and surrounding counties are either co-sponsors or supporters of the bill. However, even those who support the bill have told me they would love to hear from their constituents rather than just hear from the lobbyists on either side of the issue.

Stay well until the next post. Let me know about ideas you would like to read about in my blog.

Bob Gasparro

Robert.Gasparro@lifespanlegal.com 
Visit our website at www.lifespanlegal for more information.