A power of attorney (POA) and an Advance Medical Directive are two of the most important estate planning documents you can have, but they may be useless if they don’t comply with the federal privacy law.
A POA allows someone you designate (your “agent” or “attorney-in-fact”) to make financial decisions for you. An Advance Medical Directive specifies who will make medical decisions for you. For these documents to be effective, your agents may need to be able to access your medical information. However, medical information is private. The Health Insurance Portability and Accountability Act (HIPAA) protects health care privacy and prevents disclosure of health care information to unauthorized people. HIPAA authorizes the release of medical information only to a patient’s “personal representative.”
HIPAA can be a problem especially if you have not specified in your documents that your agent is also a personal representative for HIPPA purposes. If your document does not contain the HIPPA clause authorizing the release of medical information to your agent, then your agent may have difficulty dealing with your medical providers and obtaining the necessary information to adequately assist you.
To make sure your agent doesn’t encounter any difficulties, your documents should contain a HIPAA clause that explains that the agent is also the personal representative for the purposes of health care disclosures under HIPAA.