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Health Care Proxy vs Power of Attorney - What You Need to Know

A health care proxy and a power of attorney both can play a significant role in healthcare decisions. Learn how they compare here.

Patrick Hicks

Patrick Hicks, @PatrickHicks

Head of Legal, Trust & Will

When it comes to estate planning, we often hear different terms used interchangeably. In some cases, the use of different terms for the same meaning is correct. There are different variations in legislative terminology from state to state. However, there are also cases when applying different terms to the same meaning is incorrect, or only partially correct.

The two terms Health Care Proxy and Power of Attorney are a great example of this. While they are both roles that can play an important role in your healthcare planning, they don’t always mean the same thing. This guide will explore the differences between a Health Care Proxy vs. Power of Attorney, why the two terms are often used conjunctly, and why they’re both helpful documents to have.

What is a Health Care Proxy?

A Health Care Proxy is a document through which you legally appoint another individual to speak and make decisions on your behalf in the event that you get incapacitated. This could be a scenario such as when you are dementia and do not have the mental clarity to make your own decisions regarding healthcare. Other examples include when you are in a coma, are on life support, or are experiencing a mental health crisis. 

If your attending physician determines that you are incapacitated, then the Health Care Proxy goes into effect. This is a healthcare document that is included in your Estate Plan. For an expanded definition of Health Care Proxy, be sure to check out “What is a Health Care Proxy & Do I Need One?”

What is a Power of Attorney?

A Power of Attorney (POA) is a category of legal documents, all of which allows you to appoint another individual to perform various tasks and functions on your behalf. There are several different types of Powers of Attorney, such as a Financial POA or Special POA.

For example, a Financial Power of Attorney is legally authorized to manage your finances and make financial-related decisions on your behalf. This includes collecting income and paying your bills. Our guide “What is Power of Attorney (POA)” provides a detailed explanation of Power of Attorney and the responsibilities associated with different types of POAs.

Difference Between Health Care Proxy and Power of Attorney

The reason for which the two terms “Power of Attorney” and “Health Care Proxy” get intermingled is due to the reference “Medical Power of Attorney.” Both of the terms are correct and can be used interchangeably. However, a Health Care Proxy is just one of several types of Powers of Attorney. It is important to make this clear distinction to avoid confusion. 

There are several differences between a Health Care Proxy and a Financial Power of Attorney, for example. As mentioned earlier, a Financial POA is responsible for making any financial decisions on behalf of the Principal who appointed them. If the Principal becomes incapacitated, they cannot perform important tasks such as paying their own bills or signing checks. In this scenario, their Financial POA can legally step in and help out. They can even perform important functions such as managing investments and real estate assets.

A Health Care Proxy cannot perform any of these functions. Instead, their legal agency lies strictly in healthcare decisions. If the Principal is unable to make decisions themselves, or communicate those decisions, then the Health Care Proxy steps in and makes these decisions on their behalf. Of course, this person should be a trusted person (oftentimes a close family member) and should have been informed of the Principal’s wishes and instructions regarding their medical care. 

There can be instances when the roles and duties of two different types of proxies or agents can overlap. Planning for medical bills is a great example of this. This is an area that touches on both finances and medical care. This type of collaborative decision-making can be easy, but at times it can lead to disagreements. Here, let’s explore who has more power: Health Care Proxy vs. Power of Attorney.

Who Has More Power - Health Care Proxy or Power of Attorney?

A Health Care Proxy and Power of Attorney are two different estate planning documents that give other individuals legal agency in different capacities. Things can be made simple if you appointed the same person as both your Health Care Proxy and Power of Attorney. However, it’s not always that simple and you could have valid reasons for appointing different individuals.

However, what happens if their legal responsibilities overlap and they come into conflict? Does one or the other have more power? 

The short answer is: not necessarily. The person setting up their Estate Plan should anticipate possible disputes and put in safeguards to prevent them. For instance, they could appoint different Powers of Attorney that are amicable and can get along with one another. Further, they can give a neutral third party the power to settle any disputes should they arise. 

Health Care Proxy vs Power of Attorney - Which Is Right for You? 

If you’re trying to decide between putting a Health Care Proxy vs. Power of Attorney in place, decide no further. The key takeaway of this guide is that Health Care Proxies and Powers of Attorney serve different roles and perform different functions (aside from the occasional overlap.) They are all key roles that can come together and advocate for you on many different aspects of your life if you were to become incapacitated. Therefore, it’s a good idea to establish both documents. 

When you choose your Health Care Proxy and/or Power of Attorney, be careful to think through the intricate details. Earlier, we suggested the option of appointing the same individual for both types of roles. This can prevent the possibility of disputes between your agents. At the same time, however, this can be a huge undertaking for one person to shoulder, especially during a stressful circumstance such as your medical incapacitation. This is why many individuals choose to appoint different individuals. It can be easier for even the most amicable of people to come into conflict in high-pressure situations. Consider leaving concise instructions that layout certain decisions that should be made in various situations that can come up. Also, consider appointing a neutral third party and giving them the power to settle any conflicts and disputes that might come up. The beauty lies in the details.

Some of these decisions can be difficult to make, and it is nearly impossible to anticipate every possible scenario. (Especially when it comes to planning ahead for an event that might not even happen.) Know that you can have support every step of the way. At Trust & Will, one of our several estate planning options includes our Health Care Documents. This is an affordable bundle that includes critical documents such as a Living Will, Power of Attorney (including Medical), Last Will & Testament, and HIPAA Authorization. By accomplishing this one step, you’ll already have a strong Estate Plan in place! Find out more here

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