Arbitration agreements are a touchy subject in any context, but particularly so in the emotionally charged, often distressed, situations surrounding entry into a long-term care (LTC) facility.

Anyone attempting to keep up with the flip-flop of positions on permitting or prohibiting arbitration clauses in LTC contracts is likely suffering from a severe case of whiplash. In the last three years, the validity of arbitration clauses has gone from silent, to prohibited, and soon they could become lawful. The future of LTC resident care hangs in the balance.

The Paradox

The executive branch’s position on arbitration clauses in LTC contracts has made a 180-degree turn in recent years. In 2016, the Centers for Medicare & Medicaid Services (CMS) banned pre-dispute arbitration agreements. In 2017, CMS issued proposed revisions eliminating the arbitration prohibition.

Folks with dementia who have to be moved from one environment to another can sometimes experience stress and anxiety, termed “transfer trauma.”  The extent of the transfer trauma can vary among individuals.  For some, it can be brief, mild, or non-existent.  In others, the trauma is extensive and intense.  The more extreme cases usually involve someone with early stages of dementia who is moving from the long-time family home into a new environment. 

When planning for the future, each of us would prefer to retain some semblance of power over the assets we leave to our loved ones. But how do we help our clients control how things are divvied up or used after their deaths? One answer is to include a power of appointment in their planning documents.

Power of Appointments, Generally

A power of appointment is simply a way for the client (the “Donor”) to designate a particular someone (the “Donee”) to direct the client’s assets (the “appointive property”) to the people or entities (the “Appointees”) that the client has selected; in the ways that they have instituted; by means that they have espoused. Further, it is also a way to provide a trusted Donee with the power to select Appointees of their own choosing. A power of appointment may be created as a present power or as a conditional power.