Mortuary Law CH-14 FTC Funeral Rule

GPL Disclosures: Embalming Disclosure

In conjunction with the embalming listing, consumers must be informed of their right to decline embalming. The mandatory disclosure which accompanies the embalming price listing on the GPL on the sample GPL is designed to accomplish this purpose. This disclosure must be printed in immediate conjunction with the price listing for embalming

Sixteen Goods and Services on the GPL

(1) Basic Service of Funeral Director and Staff (2) Embalming (3) Other Preparation of the Body (4) Services and Facilities for Viewing (5) Services and Facilities for Funeral Ceremony (6) Services and Facilities for Memorial Service (7) Service and Equipment for Graveside Service (8) Transfer of Remains to Funeral Home (9) Hearse (10) Limousine (11) Casket Price Range (12) Outer Burial Container Price Range (13) Forwarding of Remains (14) Receiving Remains (15) Direct Cremation (16) Immediate Burial

GPL: Six Mandatory Disclosures

(1) Choice of Goods and Services (Right of Selection) (2) Non-Declinable Service Fee (3) Embalming Disclosure (4) Availability of Casket Price List (CPL) (5) Availability of Outer Burial Container Price List (OBC PL) (6) Alternative Containers for Direct Cremation

Statement of Funeral Goods and Services Selected: Mandatory Disclosures

(1) Listing of Legal and Other Requirements (2) Embalming Approval (3) Marking-Up Cash Advances

Primary Purposes of the Funeral Rule

(1) To give consumers the right to select those funeral goods and services which they wish to purchase (2) To provide consumers access to detailed, itemized price information prior to purchase decisions; (3) To prevent misrepresentation and other unfair and deceptive practices in the sales of funeral goods and services

Prior Permission to Embalm: Prior Permission to Embalm

A charge for embalming may be made when the family provides express permission to embalm prior to embalming. It is important to note that the permission to embalm must be expressly provided; it cannot be implied. Be specific. If a funeral director embalms the body prior to receiving permission if none of the other two exceptions (legal or exigent) exist, the funeral director cannot charge for embalming.

Casket Price List: Casket and Alternative Containers Listings

All caskets and alternative containers which a funeral home routinely offers for sale must be listed on the CPL, together with the retail price for each. Caskets which require special ordering need not to appear on the price list. There are no requirements regarding in what order the caskets and containers must be listed nor are there any requirements concerning what type of caskets must be stocked. However, if the funeral home offers direct cremation, it is required to make an alternative container or an unfinished wood box readily available -Provide brief description of the exterior construction and the interior lining. -List the gauge of metal -Prominent coloring or trimming

Outer Burial Container Price List: Listing

All containers which a funeral home routinely offers for sale must be listed on the OBC Price List, together with the retail price for each. Containers which require special ordering need not to appear on the price list. If a funeral home does not offer outer burial containers to its customers, there is no requirement that it prepare an OBC Price List

GPL: Package Funerals

Although funeral homes are required to itemize funeral goods and services, they are free to offer package selections. the funeral can assemble packages of goods and services and assign one price to it. -Can offer at discount compared to itemized pricing -Should not reduce the price of your basic service fee -While the funeral home is free to offer package pricing, it is important to remember that it must be offered in addition, not in lieu of, itemized pricing

Tying Arrangements: Third Party Merchandise

As a result of the anti-tying provisions of the Funeral Rule, funeral homes must accept and service merchandise that consumers purchase from other vendors, such as casket sellers, casket retailers and cemeteries. -Characterized by "passive" obligation. The funeral home must accept the merch but does not have to assist the consumer in any way in obtaining such merchandise. According to the FTC Staff, if a funeral home does not help unload caskets from casket wholesalers that it buys caskets from, ir does not have to help unload third-party caskets that are delivered to the funeral home. -AKA treat them the same man -May not charge delivering fee to families but can discount and encourage to purchase from you're establishment

Tying Arrangements

Exists where a seller requires a purchase of an unwanted item in order to obtain a desired good or service. -Ex: the funeral director only offers funeral services if the consumer agrees to purchase a casket from the funeral home, the seller at tied the provision of funeral services to the required purchase of a casket. This *violates* the Funeral Rule The Funeral Rule prohibits tying arrangements except in (3) circumstances (1) Non-Declinable Service Fee (2) Legal Requirements (3) Impossible, Impractical or Excessively Burdensome

Retention of Price Documents

Funeral Director are requires by the Funeral Rules to retain all price lists for a one year period from the date the price list were last distributed. Therefore, if a funeral home its price list on Jan 1 2001 it should retain until Jan 1 2012. A copy of the Statement of Funeral Goods and Services Selected should be retained for a one year period from the date of arrangement conference. After the year, the funeral director is alloed to dispose of outdated price lists and statements. Certain states mat require longer period of time for retention

Misrepresentation: Preservative and Protection Claims

Funeral directors may not represent to consumers that funeral goods or service will delay natural decomposition or remains for a long or indefinite period. While the Rule does not prohibit funeral directors from explaining that embalming provides *temporary* preservation to the body, it does prohibit any claims that embalming (or any other good or service) will preserve the body for a long or indefinite period of time Also prohibits from making misrepresentations regarding the protective features of caskets and vaults. Any claim regarding the ability of caskets and vaults to protect the body from graveside substances should not be made unless they can be substantiated

Misrepresentation: Cash Advance Items

If a funeral director marks up cash advance items or receives a commission, rebate or discount which is not passed on to the consumer, it is a violation of the Funeral Rule to represent to the consumer that the charge represents the same amount that the funeral home paid for these items. -IF the consumer is not informed which particular cash advanced item has been marked up (Funeral directors must identify what has been marked up)

Statement of Funeral Goods and Services Selected: Mandatory Disclosures: Marked-Up Cash Advances

If a funeral home adds a surcharge to a cash advance item or if it receives and retains a rebate, commission or other discount from the supplier of that cash advance item that is not passed on to the consumer, the funeral home has marked-up the cash advance. The Funeral Rule requires funeral homes to identify on the Statement those particular cash advance items that have been marked-up. If the funeral home never marks-up a cash advance item, it does not have to print this disclosure on the Statement. It should also be noted that the funeral does not have to identify the dollar amount of the mark-up. It merely has to indicate those cash advance items that have been marked-up

Casket Price List

If the GPL does not list and retail prices of the caskets offered by the funeral home, a separate CPL must be prepared. This price list is far less complicated than the GPL. Although there are certain items which may appear on the list, there are no mandatory disclosures on the CPL

GPL Disclosure: Availability of Outer Burial Container Price List (OBC PL)

Immediately under the Outer Burial Container price range, a mandatory disclosure informs consumers about the availability of a complete price list at the funeral home

GPL Disclosures: Availability of Casket Price List (CPL)

Immediately under the casket price range, a mandatory disclosure informs consumers about the availability of a complete price list at the funeral home

Introduction

In 1984, the FTC put into effect the Funeral Industry Practices Trade Regulation (16 C.F.R Part 453) That regulation, which is commonly referred to as the Funeral Rule, was reviewed and revised in 1994. -Effects all who sell BOTH funeral goods and services

Prior Permission to Embalm: Exigent

In order to fall under this, all three of the following conditions must be fulfilled (1) The funeral director is unable to contact a family member or other authorized person after exercising due diligence (2) The funeral director has no reason to believe the family does not want embalming (3) After embalming the body, the funeral director informs the family that if they choose a funeral that does not require embalming, no embalming fee will be charged, but that fee will be charged if that select a funeral that does require embalming.

Outer Burial Container Price List: Mandatory Disclosure

Informs consumers that OBC's are not generally required by law, although many cemeteries make them mandatory. That disclosure may be printed anywhere on the OBC Price List.

GPL: Disclosure: Alternative Containers for Direct Cremation

Informs the consumer that they can use and alternative container. This disclosure briefly describes the mandatory disclosure. This disclosure must be made in immediate conjunction with the price range for direct cremation

GPL Disclosure: Choice of Goods and Services (Right of Selection)

Informs the consumers of the right to choose any goods and services they wish. This disclosure should be printed immediately above the itemized price listings of the sixteen goods and services described above.

Prior Permission to Embalm

It is a violation of the Funeral Rule to charge for embalming except in the following: (1) State or Local Law (2) Prior Permission to Embalm (3) Exigent Circumstances

Misrepresentation: Outer Burial Containers

It is a violation of the Funeral Rule to misrepresent that outer burial containers are required by law when such is not the case. It is also a violation if the Rule for the funeral home to fail to affirmatively inform consumers that state law does not require outer burial containers. This duty to affirmatively inform consumers is satisfied by the printing of the required mandatory disclosure on the OBC Price List

Tying Arrangements: Non-Declinable Service Fee

It is not a violation of the Rule to require consumers to pay this charge as a condition of receiving funeral services. All other fees, however, must be declinable unless one of the exceptions listed below applies

Statement of Funeral Goods and Services Selected: Mandatory Disclosures: Listing of Legal and Other Requirements

Mandatory disclosure which informs consumers that they will only be charged for those items they have selected or that are required. -Printed anywhere on the Statement (Top preferred) Funeral home lists on the Statement any legal, cemetery, or crematory requirements which compel the consumer to purchase a specific good or service. Ex: Law requires embalming, the cemetery regulations on OBC's.

GPL: Distribution of GPL

Must be given for retention to individuals who inquire in person regarding funeral services, specific funeral goods or services, or the prices offered by the funeral home. Whenever there is a *Face-to-Face* discussion concerning the overall type of funeral service or disposition, specific funeral goods or services, or the prices for those items, a GPL must be physically handed to the individual making the inquiry. It is not sufficient for the funeral director to simply indicate that a GPL is available if one is wanted. Face-to-Face is a triggering event. Therefore, if a funeral director is removing a body from a residence, nursing home or hospital and the family inquires about funeral arrangements, a GPL must be distributed to them. -given to keep. You cannot charge or ask for it in return.

Casket Price List: Introductory Matters

On the CPL, the funeral home must place the name of the funeral home, the words "Casket Price List", and the effective date.

GPL: Introductory Matters

On the GPL, the funeral home must place its name, address, telephone number, the words "General Price List" and the effective date

Casket Price List: Distribution of Casket Price List

The CPL must be presented to consumers upon the commencement of a face-to-face discussion about offerings on the CPL or the price of those offering. The Funeral Rule makes clear that the list should, at a minimum, be distributed to the consumer prior to the funeral director showing casket models to the consumer. -Does not have to be offered for retention (May request is back) -Can be in alternative formats such as binders, notebooks, brochures and charts. -Can use software programs that present pictures of caskets in lieu of a written CPL, but only if the computer program shown to the consumer contains all of the required information which must be written on the CPL

Enforcement

The Funeral Rule is enforced by the FTC. The FTC Staff will respond to complaints from consumers or others regarding violation of the Funeral Rule. Current penalties for Funeral Rule violations for a fine of 16,000 per violation FTC sends undercover shoppers who go into funeral homes under the guise of planning preneed funeral arrangements. Typically, a funeral home will have to "fail" two different undercover shops in order to be charged with a violation IF the funeral home is charged with a violation, the FTC will offer the funeral home the option of paying fines or joining the Funeral Rule Offenders Program that is run through the National Funeral Directors Association (NFDA). To join the FROP, the funeral home typically pays a fine which is significantly less than the Funeral Rule violation. The funeral home is required to participate in a number of educational and compliance sessions run by the NFDA for a three year period. Most funeral homes charged with a Funeral Rule violation opt for participation in the FROP program

Misrepresentation

The Funeral Rule prohibits misrepresentations in six specific area. In addition, the Funeral rule has prescribed several mandatory disclosures (all of which were discussed earlier) which the FTC believes are necessary to prevent consumers from being misled in these areas. (1) Embalming (2) Caskets for Direct Cremation (3) Outer Burial Containers (4) Legal and Cemetery Requirements (5) Preservative and Protective Claims (6) Cash Advance Items

Misrepresentation: Legal and Cemetery Requirements

The Funeral Rule provides a catchall prohibition against any type of misrepresentation concerning legal or cemetery requirements. Additionally, funeral directors are required to list and describe on the Statement of Funeral Goods and Services Selected any legal, cemetery or crematory requirements that compel the consumer to purchase any funeral good or service

Tying Arrangements: Impossible, Impractical or Excessively Burdensome

The Funeral Rule provides that funeral directors are not required to honor a request for a combination of goods and services that would be "Impossible, Impractical or Excessively Burdensome" to provide. Although the funeral director will have to make the initial judgement as to what is "Impossible, Impractical or Excessively Burdensome", the ultimate judgement would be made by the FTC if a Rule violation is charged The practical necessity of embalming is one area which falls under this exception. Ex: a funeral director may refuse a family's request for the public viewing of an unembalmed body on the ground of practical necessity. -May be offensive to the public to view an unembalmed body -Embalming in such circumstances is widely recognized as a practical necessity. On the other hand, if the family request a brief viewing of an unembalmed body just for members, the funeral director cannot refuse this request

Misrepresentation: Embalming

The Rule prohibit any misrepresentations regarding the legal necessity of embalming. It is a violation if the funeral director fails to inform the consumer that embalming is not required by law, except in certain special circumstances. -Also a violation of the Funeral Rule to inform the consumers that embalming is required for (1) Direct cremation (2) Direct burial or immediate burial (3) if refrigeration is available and there is to be a funeral with no viewing and there is a casket to be closed

Misrepresentation: Caskets for Direct Cremation

The Rule prohibits a funeral director from representing that state or local law requires a casket for direct cremation. Additionally, if a funeral home offers direct cremation, it must make available for direct cremation consumers alternative containers or unfinished wood boxes

General Price List (GPL)

The cornerstone to the Funeral Rule. This is given to the consumer prior to purchase of the funeral and provides him with a detailed itemized listing of the goods and services offered by the funeral home

Outer Burial Container Price List: Introductory Matters

The name of the Funeral home, the words "outer burial container price list" and the effective date of the OBC Price List must be printed at the top of the price list

Statement of Funeral Goods and Services Selected: Mandatory Disclosures: Distribution of Statement

The presentation of the Statement is to be made at the conclusion of the funeral arrangements. It should be completely filled out and show the total price of the funeral. Signatures are not required on the statement, although they are recommended since the Statement can serve at the funeral contract. If arrangements are made pursuant to a telephone call, the Statement should be promptly mailed or faxed to the consumer

Statement of Funeral Goods and Services Selected: Itemized Entries

The purpose of this is to provide consumers with an itemized list of their purchases at the conclusion of the funeral arrangement. To accomplish this, the listings on the Statement must reflect the listings on the GPL. The itemized price of each good and service must also be written on the Statement. If a consumer purchases a package funeral, the funeral director should list the purchase of the package on the Statement together with the package price. In addition, the funeral director should list on the Statement each good and service that is included in that package. -Also list any cash advanced item -F.D should make a reasonable estimate of the cash advanced on the Statement

GPL: Mandatory Disclosures

There are six separate mandatory disclosures which must appear on the GPL. Funeral directors are prohibited from editing and modifying the mandatory disclosures. they should appear on the funeral homes GPL in the exact wording provided in the sample model. Also, the mandatory disclosures must be printed in a clear and conspicuous manner. This means mandatory disclosures should not appear in smaller type than the other printed material

Statement of Funeral Goods and Services Selected: Mandatory Disclosures: Embalming Approval

This disclosure explains to the consumer the requirements for embalming. -This disclosure may appear anywhere on the Statement. -Companion requirement which mandates that the funeral director list on the Statement why embalming was performed. (Family consent, interstate transportation, public visitation)

GPL: Itemization of Sixteen Goods and Services

To insure that consumers have the right to pick and choose those select items they wish to purchase, the FTC has selected sixteen various items that *must* be separately priced in the GPL. It is important to note that funeral homes are only required to list these goods and services if they offer them for sale. Ex: if a funeral home elects to not offer embalming, it may be deleted from the GPL. Funeral homes will typically sell additional goods and services other than the sixteen which must be separately itemized. While funeral homes are not required to place other goods and services on the GPL, as a matter of proper business practice, it is recommended that all goods and services offered by the funeral home be listed on the GPL

Tying Arrangements: Legal Requirements

To the extent that the state or local law requires the purchase of a funeral good or service, the funeral director may tie the purchase of that good or service to the provision of the funeral service. Ex: If law requires embalming of contagious disease cases, the funeral director may require embalming of all contagious diseases cases as a condition of providing funeral services

GPL Disclosure: Non-Declinable Service Fee

Under the Basic Services of Funeral Director and Staff on the GPL. This disclosure informs consumers that the basic service fee is non-declinable and that it has been included in the charges for direct cremation, immediate burial, and forwarding and receiving remains. This mandatory disclosure must be made in immediate conjunction with the listing of the Basic Services of Funeral Director and Staff

Telephone Price Disclosures

Whenever an individual telephones a funeral home and asks about the funeral homes offerings or prices, *the funeral home must provide accurate information in response to those inquires*. The funeral home is prohibited by the Funeral Rule from refusing to give price information over the telephone. The funeral director cannot insist upon the called identifying himself or herself as a condition to the disclosure of price information over the telephone -if a funeral director or trained staff member is not available to provide the requested information, a message should be taken and the called should be returned by the funeral director.

Prior Permission to Embalm: State or Local Law

Whenever state or local law requires embalming, it is not a violation of the Funeral Rule to charge for embalming that was not authorized by the family. However, funeral directors would be required to note on the Statement that embalming was performed because of legal requirements

Outer Burial Container Price List: Distribution of Outer Burial Container Price List

Whenever there is a discussion of outer burial containers, the funeral director should present to the consumer the OBC Price List. As with the CPL, the OBC Price list should be given to consumers prior to the funeral director showing any displays or models. -Does not have to be offered for retention (May request is back) -Can be in alternative formats such as binders, notebooks, brochures, charts and computer programs in lieu of a printed OBC Price List