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How did you find out. Because no one but the POA should have been given this info.
A POA is under no obligation to share ANYTHING with the family that the principal who appointed him/her POA doesn't want shared. The POA acts in accordance with the specific obligations written out in the document. There is no obligation to share medical or financial information or any other private information to family in most cases.
There is likely some reason that the second cousin chose his or her POA over a family member; it was the cousin's decision. The POA is accountable only to the cousin and to the courts. The POA ends at death of the appointing principal.
Your cousin chose not to notify family of diagnosis, or was unable to do so. Without explicite instructions from Cousin to POA about what to do the POA is under no obligation to share any private information whatsoever.
That is POA duties as I understand them, but a question such as this is better passed by an elder law attorney in your own state. Laws may differ.
More information can be found here:
Power of Attorney Rights and Limitations - AgingCare.com.
Type this into search at the blue AgingCare line above and you will have more information as well.
I know you're asking about your cousin, whether he had a legal duty to inform. Let me just say, the doctor, if death is imminent, should have told your grandfather directly.
It used to be, years ago, in some countries, that doctors would not tell patients when they have cancer and death is imminent, because it could mentally traumatize them, and might make them give up on life. So doctors would tell the family, and not the patient. This secrecy is no longer done. Now the patient has a right to know their diagnosis, if death is imminent.
When death is not imminent, there can be cases where a doctor believes it's better not to tell the patient, and only tell a family member. Again, in order not to traumatize the patient, and not take away their will to live. But again, this secrecy is only allowed if death isn't imminent.