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Why do college students need to think about estate planning? The short answer is because most college students are over the age of 18.
When your child turns 18, a significant legal event happens in their lives: they are considered an “adult” under the law. This means they are responsible for making their own health care decisions, and, under the Privacy Rule of the Health Insurance Portability and Accountability Act (commonly referred to as HIPAA), a parent can no longer access their adult children’s medical records or other healthcare-related information.
The combination of these two factors – your child turning 18 and HIPAA – means that as a parent, you are no longer able to make health care decisions for your child nor are you able to access their medical records. Practically speaking, this makes it difficult – if not impossible – to intervene and assist if your child needs medical help, especially if you are trying to do so from a distance. And while this may come as a surprise, this is the case even if your child is still on your medical insurance.
For example, if your child is injured in a car accident while away at school and arrives at the emergency room unable to communicate with the doctors, you as their parent cannot automatically step in and help. In fact, in some instances, the hospital may not even be willing to tell you if your child has been admitted to the hospital, let alone give you information on the extent of their injuries.
This is an awful position to find yourself in as a parent. Fortunately, it can be easily avoided with three simple, easy to prepare estate planning documents.
Power of Attorney for Health Care
A Power of Attorney for Health Care allows your child to appoint an agent (typically one or both parents) to make health care decisions for them if they are incapacitated and cannot make such decisions for themselves. With a Power of Attorney for Health Care in place, there are no legal barriers preventing you from obtaining information about your child and making decisions for them if they cannot do so themselves.
A HIPAA Authorization allows your child to designate who can access information about their medical records and health condition. It is important to have a HIPAA Authorization in place because a Power of Attorney for Health Care only comes into effect if you child is incapacitated, but does not allow you to access their medical records if they are not incapacitated. If your child has a complicated or long term health condition, access to their medical records is important if you’re helping them make appointments with specialists or identifying the best course of treatment.
Springing Power of Attorney for Finance
A springing Power of Attorney for Finance allows your child to designate someone to access their financial accounts and undertake other important activities, such as filing a lawsuit on their behalf, if they become incapacitated. The word “springing” means that this document is only effective in the event of an incapacity. This strikes a nice balance between allowing your child to be financially independent while also making sure they are protected in the event of an emergency.
Without these three documents in place, a parent’s only choice is often to petition a court to be appointed as their child’s guardian or conservator. This is an expensive process and involves dealing with attorneys and courts, the last thing a parent wants to worry about during an emergency.
If you have children heading off to college this fall, or if you have a child over 18 who you want to be able to assist in the event of an emergency, take the time to put these three documents in place. Hopefully, you’ll never need to use them, but it’s always better to prepared in case some doesn’t go as planned.