Financial and Legal Planning Resources and Assistance Options for Seniors with Alzheimer's
Reviewed by: Deidre Sommerer, LPN, MS, CMC, CDP
Published/updated: September 10, 2022
Receiving a diagnosis of Alzheimer’s disease is very difficult. Whether you’ve been diagnosed or a loved one has recently received this news, you’re likely coping with grief about lost opportunities, anxiety about what the future holds and worry about everything that needs to be organized. If this is impacting you, you’re not alone. It’s estimated that 5.8 million people in the United States had Alzheimer’s disease in 2020, and if there aren’t any advances in treatment, it’s likely that number will grow to 13.8 million by 2060. Planning for the future can help you get control of the situation and ensure you’re prepared as challenges arise.
When making these plans, it’s important to ensure all the legal paperwork is completed. This guide explains the legal, financial and health care planning documents that you should finalize after a dementia diagnosis. It also has tips on advance planning for Alzheimer’s disease and outlines some of the financial resources that may be available to people with the condition.
Overview of Legal, Financial and Health Care Planning Documents
Understanding the legal, financial and health care documents that are needed can help you begin organizing for the future. Below is information that gives an overview and the documents you may want to prepare.
Important Health Care Documents for People With Dementia
Health care documents allow the person with dementia to make their wishes about future care known before the disease progresses too far. These documents also give someone else permission to act on their behalf when they can no longer make their own decisions.
|Type of Medical Document||What It’s For||Where to Get It|
|Medical Power of Attorney or Health Care Proxy|
(term varies by state)
|This enables a person to appoint a relative or friend to act on their behalf in regard to medical decisions. It only takes effect when the person is incapacitated.||Draw up with help from attorney|
|Advance Health Care Directive||Also known as a living will, an advance health care directive makes a person’s medical wishes known. It’s used when the person can’t speak for themselves. It lists the treatments, medications and procedures the person does and doesn’t want to receive.||Draw up with help from an attorney or through reputable sites that offer step-by-step instructions like Five Wishes for a minimal fee. This organization is recognized in all states with the exception of four states that require an additional step to make their documents binding.|
|Do Not Resuscitate (DNR) Form||People who don’t wish to be resuscitated must fill out a state-sponsored DNR form. This binding legal document means that hospitals and emergency medical personnel won’t use CPR or intubation.||Each state has a separate form. Most have to be authorized by a physician and signed by a witness.|
|HIPAA Authorization Form||This form names a caregiver who can access medical information. This allows a doctor or other health care professional to discuss treatment, medical status or billing information with someone other than their patient.||Doctor offices generally have blank copies available|
|Physician Orders for Life-Sustaining Treatment (POLST)||POLST forms are used by people who are chronically ill or medically frail. Like a living will, it details medical treatments a person consents to, including CPR. However, it doesn’t rely on a surrogate making decisions. It’s a medical order and health care workers recognize the form and are required to follow the instructions.||POLST programs and forms differ between states. Forms must be signed by a physician.|
Things to Know About Health Care Documents for People with Dementia
When organizing health care documents, it’s important to keep the following in mind:
- The person with dementia retains control. Any health care document is only valid after a person has been deemed incapacitated. It’s worthwhile talking to the primary care physician to find out what that will look like as the disease progresses and what steps must be taken to have someone deemed unfit.
- Understand the terms. The person with dementia who is naming a power of attorney is known as the principal. The person named to act on their behalf is the agent.
- Communicate regularly. If you’re named as a parent’s agent, you should be following their wishes. Talk regularly about what they want so you understand how they want their care to proceed.
- Choose a limited number of agents. It can be tempting to name multiple agents to share the responsibility or allow every child to have a say. However, this can lead to confusion and disputes. Doctors may also delay treatment until a consensus is reached. Name just one or two trusted agents to ensure a smooth process.
- Consider a backup agent. Although you only want one agent, you may wish to name an alternative agent in case the first person is unavailable or also incapacitated.
Important Documents for Financial and Estate Management for People with Dementia
It’s not just health care decisions that people with dementia have problems managing. A person’s finances and estate also need to be taken care of, and it’s likely they will need help doing this as the disease progresses. Documents that name an agent to take care of financial matters can ensure practical matters are handled. A will is also essential, as it ensures your parent’s estate is distributed in accordance with their wishes.
|Type of Document||What It’s For||Where to Get It|
|Will||A will appoints an executor and names beneficiaries to ensure belongings are distributed correctly after a person’s death.||Draw up with the assistance of an attorney.|
|Living trust||A living trust appoints a trustee to manage a person’s assets for the benefit of their eventual beneficiary. Unlike a will, this allows an estate to pass to the beneficiary without a probate process.||Draw up with the help of an attorney.|
|Financial Power of Attorney||This gives someone the legal authority to act on another’s behalf regarding finances. It can come into effect immediately or only after the principal becomes incapacitated.||There are forms online that you can fill out, but it can be easier to use an attorney to ensure all possibilities are covered.|
|Guardianship||A guardian or conservator is appointed by a court to make decisions about health care and property for the person with dementia. If other legal forms are completed soon after diagnosis, it may not be needed.||Must be done through an attorney and involves a court appearance. Depending on the state, two physicians must certify that the person being conserved is not competent.|
|Advanced Permission for Communication||This provides a caregiver with permission to discuss matters with companies and government departments on behalf of the person with dementia.||Each organization must be approached separately. Arrange this with:Insurance companiesMedicaid/Medicare Utility providersSenior living organizationsBanksFinancial advisors|
Things to Know
Keep in mind the following tips when organizing financial documents:
- Ensure it’s a durable power of attorney. A normal financial power of attorney is automatically revoked when the principal is deemed incapacitated. Making it a durable power of attorney ensures the agreement either starts or continues when the person can no longer look after their own affairs.
- Must be separate. A financial power of attorney doesn’t give the agent any power of health care decisions. Likewise, a medical power of attorney doesn’t provide any rights to finances. The agent can be the same person, but two separate documents must be drawn up.
- Consider a professional. It can take time to manage a person’s finances. If you or your loved one doesn’t know anyone with the ability or time to do this, it’s possible to appoint a lawyer or accountant to the position, as long as you have one you trust.
Advance Planning Advice for People Living With Dementia
Start Discussions Early
It’s likely that a person with Alzheimer’s disease or another form of dementia will eventually lose the ability to think clearly. When this happens, they will no longer be able to participate in legal and financial planning. For this reason, it’s best to start discussions as soon as possible after a diagnosis.
Essentially, you want to have these conversations while the person is still able to understand the discussion and make decisions about their own care and finances. Additionally, there are some forms that must be signed while the person is still deemed legally capable. This includes the will and powers of attorney documents.
Although it’s important to start these processes as soon as possible when a person is diagnosed with dementia, don’t push for fast decisions. You want your loved one to be comfortable with the choices they’re making, and it can take time to come to terms with the diagnosis and consider all the options for care. These decisions can’t be put off forever, but allow your loved one to move at their own pace as much as possible.
Emphasize the Positive
Both a diagnosis and conversations about future planning are challenging. Making decisions may also cause conflict in the family. Make sure you emphasize that the process will ease tension in the future and ensure that your loved one’s wishes are followed when it comes to their care and estate.
Discuss With the Whole Family
When starting to make these decisions, it’s likely that a discussion between a smaller group will be more comfortable and productive. But it’s good to have conversations with all relevant family members at some stage. This is especially important if one child is chosen as the agent, removing their siblings from future decision-making.
Talking about decisions and plans openly helps ensure the agent is supported when it’s time to take control. If everyone involved knows the wishes of the person with dementia, things will go more smoothly once that person is incapacitated. These discussions can happen one-on-one or in a group, whichever is more comfortable for the person living with dementia.
Gather Important Documents
You must have access to any needed documents in the case of an emergency or when your loved one can no longer manage their affairs. Gather any important documents together and keep them in a safe place. You should also give copies to family members or a trusted person so they’re not lost.
This doesn’t just refer to the documents you’ve recently created, such as a living will. It also includes deeds to any property, bank statements, bills and insurance policies. Ask your loved one where these documents are kept, and if necessary, store them in a secure place.
Review Plans Over Time
Changes in the personal situation of the person with dementia, or their agent, can impact these plans. A relocation may mean an agent can no longer act as power of attorney, for example. A divorce or death may also necessitate a change to documents, as can changes to state law. Review documents regularly and update them as required.
You should also continue to have conversations about future plans for as long as possible. A person with dementia may change their mind about how they want to be cared for as the disease progresses. If they’re still capable of making that decision, it should be taken into consideration, so ensure the agent is available to talk to if required.
Reduce Anxiety About Funeral and Burial Arrangements
Many older adults worry about the costs and planning of their future funeral. Making plans early can ensure that their wishes are taken into consideration and reduce anxiety for everyone in the family. This may also be a good time to consider funeral insurance or a burial trust so that the person living with dementia knows their family won’t face a financial burden after they die.
Where to Get Help With Legal and Financial Planning
It’s possible to find templates and do-it-yourself guides for many of the documents discussed in this guide. However, any legal agreement can be complex, and states may have differing laws that govern these documents. This is why it’s often best to get professional help when starting your future planning. Free advice, including legal advice, may be offered through your local Area Agency on Aging.
|Elder Law Attorney||Lawyer that specializes in senior law and understands state and federal regulations||Can draw up all documents needed by seniors and ensure their interests are protected|
|Health Care Providers||A person’s doctor, nurse or specialist||Can encourage planning discussions between families and help everyone understand medical options and how the disease is likely to progress|
|Geriatric Care Managers||Trained social workers or nurses who specialize in geriatrics||Evaluate needs, help make plans, coordinate medical services and help select care personnel|
|Nonprofit Organizations||Organizations set up to advocate for and help people diagnosed with Alzheimer’s disease or other forms of dementia — The Alzheimer’s Association is the most well-known||Have online resources that can help you understand what’s needed and may also direct you to people in the area who are able to help with practicalities|
Financial Assistance Programs for People With Alzheimer’s and Dementia
Health conditions can have a significant impact on a person’s finances, and Alzheimer’s disease is no exception. Thankfully, financial assistance is available. Some programs pay specifically for medical costs, and others have money available for general living expenses.
|Medicare||Government health insurance program available to people aged 65 and over or younger people with a disability||Medicare pays for inpatient hospital care, hospice care and up to 100 days of nursing home care. Part B pays for care from other health care providers as well as home health care and regular cognitive screenings.||1-800-633-4227|
|Medicare Advantage (MA)||A type of Medicare plan that combines the different Medicare parts into a single policy offered by private providers||MA has special needs plans that provide targeted care to people with certain medical conditions, including dementia. This can provide additional benefits needed by people with dementia, including care coordination.||1-800-633-4227|
|Medicaid||Medicaid is a government health insurance program administered by states. It’s available to low-income people who meet certain criteria, such as being aged 65 and over or having a disability.||As Medicaid is run by states, exact benefits and programs may differ. People with dementia can access in-home care and adult day care through the program. Medicaid also pays for nursing home care.||1-800-318-2596|
|Social Security Disability Insurance||This is a federal insurance program to help people with a disability that’s expected to last at least a year or result in death. To be eligible you must have worked a certain length of time.||Pays benefits to the disabled person and certain family members. The benefits are based on average covered earnings while the disabled person was working||1-800-772-1213|
|Supplemental Security Income||A means-tested program that helps disabled children and adults, as well as people aged 65 and older meet their basic expenses||A cash payment is provided. The amount differs based on a person’s living arrangements and countable income. Some states provide additional income to SSI recipients.||1-800-772-1213|
Some states have additional programs that can provide financial or health care assistance to people with Alzheimer’s disease. In some instances these are designed specifically for people diagnosed with dementia, but in other cases, they’re available to all eligible people aged 65 and over.
|Long-Term Care Insurance||This is insurance that covers long-term services and support. You may not qualify for a new policy if you’re already diagnosed with dementia or receiving long-term care.||Long-term care insurance policies pay out a certain amount for services that help with daily living, such as bathing, grooming and eating. The exact amount, care options and other benefits differ depending on the policy.||Talk to your insurance company|
|Consolidated Omnibus Budget Reconciliation Act (COBRA) Insurance||COBRA is a federal law that allows a person to stay on their employer’s group health plan after their employment ends. To continue to receive benefits, you must pay the full premium, including the portion the employer paid.||If a person diagnosed with dementia is under 65 and still working, COBRA may be an option. The health care can continue for 18, 29 or 36 months, depending on the circumstances.||(877) 262-7241|
|Long-Term Disability Insurance||This provides benefits to people who can no longer work due to a disability. Some employers offer this insurance, or individual policies can be purchased.||It pays a percentage of income to people with a disability. It doesn’t provide benefits to people aged 65 or older but can help people who were diagnosed with dementia at a younger age.||Talk to your insurance company|
|Life Insurance||Life insurance pays money to a beneficiary on the death of the policyholder. Some policies also allow people to access cash before death.||You may be able to borrow from a policy’s cash value or receive part of the face value as a loan. Some policies also pay benefits if the insured person has a terminal illness.||Talk to your insurance company|
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