Estate planning isn’t just about dividing assets; it’s about making sure your wishes are respected, especially during life’s unexpected moments.
Two key documents that help with this are healthcare proxy and power of attorney documents. While both play important roles in planning, they cover different aspects of your care and decision-making.
In this article, we’ll compare these two documents, including which roles each document covers, when each role can use their authority, how to appoint people for these roles, and more.
What is a healthcare proxy?
A healthcare proxy is a term often used in the United States and refers to a substitute decision-maker who makes healthcare and personal care decisions on your behalf. This trusted person ensures your healthcare preferences are followed when you can’t communicate them yourself.
A healthcare proxy can also be referred to as an attorney for personal care or an attorney for healthcare.
What are the powers of a proxy?
A healthcare proxy has the authority to make decisions about your medical treatments, care plans, and even life-sustaining measures. However, they can only act within the scope you’ve set out in your personal directive (also known as an advanced directive or living will). Their power doesn’t extend to non-medical decisions, such as financial matters.
This role takes effect when a serious illness or injury leaves you incapacitated, giving your proxy the legal right to consult with doctors and act according to your wishes.
Who appoints a proxy?
Any adult of sound mind can appoint a healthcare proxy.
If someone lacks capacity, provincial laws decide who their substitute decision-maker is. This is similar to how Canadian estate laws decide how your estate is divided if you pass away without a will.
Curious about automatic substitute decision-makers? Check out our article on next of kin and powers of attorney →
What provinces in Canada allow a healthcare proxy?
Not all provinces in Canada use the term "healthcare proxy," but most have similar legal arrangements. Here’s a breakdown of some provinces and how their respective documents and roles work.
What is a power of attorney?
A power of attorney (POA) is a legal document that gives someone the authority to act on your behalf. This person, known as your "attorney," is someone you trust to manage specific tasks when you can't do so yourself, either due to absence, illness, or incapacity.
The two main types of powers of attorney
- Power of attorney for personal care: This appointed attorney is a healthcare proxy given the authority to make healthcare decisions on your behalf if you’re unable to communicate. As your appointed representative, they can make choices about your medical care, living arrangements, meals, and clothing.
- Power of attorney for property: This type of attorney covers decisions about your property and finances. Whoever you appoint as an attorney for property can manage tasks like paying your bills, handling your bank accounts, overseeing your investments, and collecting money owed to you if you're unable to do so yourself.
How long do powers of attorney last?
There are two subcategories of powers of attorney that have to do with when and for how long the appointed attorney is allowed to act. But it’s also important to note that a POA can be overridden and an attorney removed from their role if there are just grounds to do so.
A general POA ends if you become mentally incapacitated. It’s useful for situations like extended travel, where someone needs to manage your legal or financial affairs. Their responsibilities might include paying bills, selling property, or filing taxes.
An enduring POA remains valid even after you become mentally incapacitated. The person you appoint can continue making legal, financial, or medical decisions for you if you're no longer able to.
Legal authority and limitations
A POA for property is for property, and a POA for personal care is for personal care. While you can appoint the same person for both roles, someone appointed as your attorney for property cannot make decisions about your healthcare, and vice versa.
An attorney cannot act on your behalf after you’ve passed away. Their role is only valid during your lifetime, after which your executor will be responsible for distributing your assets based on your will.
A POA can also be customized to limit or expand the powers given to your attorney, but their authority ends if you revoke it or become incapacitated (unless it's a POA for personal care, which is only effective when you are mentally incapacitated).
Learn more about special limited powers of attorney →
Differences between healthcare proxy and power of attorney
A healthcare proxy (or attorney for personal care) makes decisions about your medical and personal care when you're unable to do so, while an attorney for property can manage your financial and legal matters.
When to choose a healthcare proxy or power of attorney for personal care?
Remember, you can appoint an attorney for personal care or property at any time, not just if you’re sick, injured, or away from the country.
If your main concern is making sure your healthcare decisions are respected when you’re unable to speak for yourself, a healthcare proxy or POA for personal care is a good choice. Both give someone the authority to make medical decisions for you, covering situations like:
- Serious illness or medical procedures
- Age-related cognitive decline
- Sudden incapacity due to injury or unexpected illness
In these situations, a healthcare proxy or POA for personal care ensures your preferences for treatments, surgeries, and end-of-life care plans are all followed.
When to choose a power of attorney for property?
If you need someone to manage your financial and legal affairs, a POA for property is the way to go. This type of POA is essential in situations where:
- You’re travelling for an extended period and need someone to handle bills or investments.
- You become incapacitated and can no longer manage your property or finances.
- You want to designate someone to sell property, manage your business, or make financial decisions in your absence.
In many cases, people choose both a POA for personal care and a POA for property to ensure they have trusted individuals managing both their healthcare and finances.
How to set up a healthcare proxy and power of attorney
Who is allowed to be your substitute decision-maker?
The requirements for who you choose to be your POA for personal care or property vary by province. It’s important to check that your chosen person meets the requirements for where you live.
Generally, when thinking about proxy selection, your substitute decision-maker should be:
- At least the age of majority in your province (often 18 years old, but there are exceptions)
- Aware of your personal interests and affairs
- Someone you can trust and rely on
- Someone with the time to oversee their responsibilities
- Someone who lives nearby or can be accessible on short notice
Guide to making your power of attorney documents
To legally appoint someone as your attorney, you need to execute power of attorney documents. For a step-by-step checklist on how to make your documents and the rest of your estate plan, download this free checklist.
Remember that when you create a Premium or Premium x 2 account on Willful, you get free unlimited updates on your will, power of attorney documents, and asset list! This means you can also change your appointed attorney at any time for free. Plus, you save thousands of dollars compared to making an estate plan with a lawyer.
Choose your representatives today
To unlock peace of mind, every adult should have power of attorney documents covering the legal, financial, personal, and medical aspects of their lives. That way, you know that if anything ever happens, someone you trust will be there to make sure your wishes are followed.
With Willful, you can make those legal documents easily from the comfort of your own home.
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