A dementia or Alzheimer’s diagnosis brings a specific kind of fear into a family, fear about the parent’s health, and fear about decisions nobody has made yet. Attorney Cary Moss sees this fear walk through her office door every week. Her first job is rarely legal. It’s calming people down enough to start making decisions.
The Diagnosis Alone Doesn’t Decide Legal Capacity
A cognitive decline diagnosis by itself doesn’t prove someone can’t make decisions. Capacity exists on a spectrum, and someone in the early stages of dementia may still understand what a legal document does, who they’re naming, and what authority they’re handing over. Cary Moss meets with clients alone, without family in the room, specifically because someone else’s answers can mask what the client actually understands. If she’s uncertain, she’ll ask for a letter from the person’s doctor before moving forward. The diagnosis opens a conversation. It doesn’t decide the outcome.
Four Documents Come First
Before anything else, Cary Moss prioritizes the durable power of attorney, the document that lets a trusted person manage someone’s financial and legal decisions if they can’t. After that comes the health care side, starting with a living will that states end-of-life wishes, a health care surrogate designation naming who makes medical decisions in an emergency, and a HIPAA release so family can actually get information from doctors. Signed early, these four documents let a family act the moment something happens instead of waiting on a court.
When Documents Come Too Late, Guardianship Steps In
Once someone loses the capacity to sign, the legal options narrow fast. A family without a power of attorney has to petition a court for guardianship, a process that takes four to six weeks and starts at $3,000 to $5,000 in Florida, plus ongoing legal fees for as long as the guardianship lasts. Cary Moss describes one client married for 50 years who had to seek court approval every time she needed to sign a lease or repair contract on jointly owned rental property, because her husband, incapacitated by a stroke, could no longer sign for himself. A power of attorney would have prevented all of it.
Dementia Patients Are Frequent Targets for Financial Exploitation
Impaired judgment and memory loss make dementia patients easy targets for scammers, and the schemes are getting more convincing. Cary Moss worked with a client who was exploited out of $400,000 over the course of a year by someone she met online, drained through prepaid cards, wire transfers, and Bitcoin ATMs. Warning signs include unusual excitement or secrecy around finances, unrecognized transactions, and a sudden reluctance to discuss money. Families can act before a diagnosis even closes the window, enrolling in online banking to check transactions daily, freezing credit with the three reporting bureaus, and repeating the same warning often. No government agency asks for payment over the phone.
Medicaid Planning Doesn’t Stop at the Diagnosis
Many families assume a diagnosis ends their Medicaid planning options. It doesn’t. Depending on marital status, strategies still include spending down assets on exempt property like a home or vehicle, a spouse making a loan to a trusted party, or an annuity that protects assets while meeting program limits for a spouse who still lives independently. A personal care contract can also pay a family caregiver directly, as long as it’s set at fair market value and documented properly. None of this works without the underlying legal authority already in place, which is why the power of attorney remains the document everything else depends on.
If you want to learn more about Life, Legacy & Wealth, check out https://sawyerandsawyerpa.com/podcast/
