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You say you have a durable financial POA. Read the document and make certain. If, in fact, it is a standard durable POA, and not a springing POA, you have the authority to put it into effect this minute. The document became effective the day it was signed. In order to act on her behalf with all of the various institutions you will deal with, they all must receive a copy of the POA so they know you have the legal authority to act for your mom.
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Geaton is correct. You need to read the POA document. IF you require the letters of two physicians then you need to let these docs know that you have found appalling financial stuff going on here, and you need a diagnosis so you can institute this POA, cancel credit cards, make a safe spending account for Mom and get things in CDs she cannot touch, for her own safety. It sounds like this is a mess. I can't know how much money is involved; only you can know that. You can speak to your Mom also about going to draw up a POA if she is not diagnosed yet. If they think she is competent then she is competent to do that.
I wish you good luck.
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Start by reading your PoA document to see when exactly your authority is legally activated.

What you do next will depend upon what authority you do or do not have. I would not waste any time setting up a budget. 1) she has proven to not care or live in reality regarding her finances, and; 2) if she does have cognitive impairment a budget will be for you to manage, not her. She won't be able to follow it.

A PoA's power may be in force if she is temporarily cognitively incapacitated, so you may want to check the document and then decide to try to clean up her mess or not. No, it is not too early to have your finger on the pulse of what's going on since you'll be managing it eventually, anyway.

The lesson I learned was to take advantage of your mom being out of her house and look for other problems and struggles she's having. My MIL had countless cartons of checkbooks that she kept ordering because her short-term memory was fried. She'd write one check out of one book then open another carton (12 boxes of checks in a carton) and write another check and nothing was documented in her checkbook ledger. Other bills weren't getting paid, she was upside down on a ballooning 2nd mortgage, behind on property taxes, medications weren't being taken correctly, food was spoiling in her fridge, etc. It shocked us because she didn't seem "that bad". She was not even remembering to feed herself.

I took the opportunity to take pictures of her driver's license, Medicare card, SS card, bank account number, homeowner's and car insurance, and took possession of cc's that she wasn't (or shouldn't be) using. By doing this I opened up online banking for her so I could monitor her account for balance and fraud and set up BillPay for more important bills to be paid on time. I sorted through her mail first to find the bills and throw out tempting junk mail. I found any medical records and took pictures. In short, I saw a train wreck coming and all I could do was minimize its impact on the both of us by being preemptive.

FYI your mom should designate you as her Medical Representative so that her medical team can discuss her health issues with you without her being present. This is separate from medical PoA and has to do with HIPAA rules. Ask the clinic or receptionist at each doctor's office for this form for her to sign.

Finally, please be aware that unless she is very wealthy, she might need Medicaid to pay for her care and many states have a 5-year "look-back" period on the application. Please find out what it is for her state. I recommend you and her invest in a consult with an elder law attorney to understand the minefield of financial transactions that could easily delay or disqualify her. Even if she doesn't go, you should. My in-laws were selfish spendthrifts their whole lives and never learned their lessons from being in debt over and over. They put their entire family into a terrible position by never planning and going into their retirement not only broke but deeply in debt yet expecting us, with a young family and a business to run, to be their hands-on caregivers and retirement plan. Don't feel guilty if she winds up in a less-than-ideal care situation: this is what she planned for. She had her entire life to learn and save and chose not to do either. You are not responsible for her happiness. Just do your best and eat the elephant one bite at a time, especially if you start early. I wish you all the best!
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Isthisrealyreal May 2021
Great information, I just want to chime in on the Durable Medical Power of Attorney and HIPAA release.

Everyone should have a HIPAA draw up by an attorney that specifically says that it never expires and is intended to be valid in any jurisdiction that it is presented in.

The ones that you sign in clinic are only valid for 12 months. The time that you find this out, usually in the middle of a crisis and the office staff are happy to tell you that you don't have a valid HIPAA release.

It is worth the effort to get a lifetime HIPAA release for your DMPOA.
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I'd get the situation(s) with the credit card and suspected fraud resolved first, rather than trying to introduce a whole new set of healthy spending habits. You say she was resistant to the budget, but did she co-operate with identifying the credit card transactions?

You won't need to resort to the DPOA for this, your mother can give her permission for the company/ies to discuss her account with you over the phone.

She has been ignoring the situation intentionally, and that probably means it hasn't stopped her feeling sick with worry about it. Get it sorted and out of the way, and perhaps the relief will be a good basis for better management (and confidence in you) in future.
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