FTC Funeral Rule
What Consumers Cannot be Required to Purchase - The Rule expressly prohibits you for charging any fee as a condition of furnishing goods and services except:
-basic services of funeral director and staff -funeral goods and services selected by customer -funeral goods and services required to be purchased by law, cemetery, or crematory -you cannot charge a casket handling fee for caskets purchased elsewhere
Compliance Tips - Price List Dates:
-be updated -make sure its not too old -old dates raise suspicions in inspectors
Transfer of remains to funeral home
-can be a flat fee, hourly charge or mileage
Hearse & Limousine
-can be a flat fee, hourly, or mileage
Use of equipment and staff for graveside service
-can charge a separate fee for committal at the graveside, this item is for use when there is no funeral or ceremony elsewhere
Outer Burial Container Prices
-can list a OBC price w/ OBCPL -can list each OBC individually on GPL
Casket Prices
-can list a casket price w/ CPL -can list each casket individually on GPL -must have your lowest casket price listed (alternative container)
Use of facilities and staff for funeral ceremony
-can list a separate fee for this services at another facility
Use of facilities and staff for memorial services
-can list a separate fee for this services at another facility
Use of facilities and staff for viewing
-can list charges if viewing is to be done at another facility
Consumer Friendliness - No Jargon:
-use direct language -no funeral buzzwords
Magnusson-Moss Warranty Act
-warranties on consumer products
Who must comply?
Any person who offers both funeral goods AND services to the public
General Price List (GPL)
-a printed list of all goods and services offered for sale by funeral providers with retail prices -is the keystone of the FTC Rule -must contain identifying information -must have itemized prices for goods and services -allows consumers to price shop and buy only the services and goods they want
Does the Rule require a GPL be given to keep?
-a verbal offer is not enough to comply -you cannot merely tell them one is available for inspection -you cannot show them one and tell them it is for funeral home use only -you must physically offer them one, after that it is up to them what to do with it -you cannot discourage them from looking at a GPL -you cannot charge a fee for a GPL
VIOLATIONS Forwarding of remains:
-all charges for this such as transportation, embalming, and service fee should be included -you must list all the components of this service
Legal Requirements Statement Disclosure
states that you will only charge consumers for the items they have selected and you will explain any legal, cemetery, or crematory requirements in writing
1970's
sunset legislation eliminates various regulatory boards
Compliance Tips -
-combine price lists -give out GPL before Package Price Lists -being in a room w/ caskets or OBC's before the list is handed out is a violation, even if it is just for arrangements -point out GPL's in the package price lists -do not laminate the GPL -urn filling fees should apply to all urns
1997
test shopping begins
Fair Packaging and Labeling Act
-contents, packaging, and distributor info on consumer packaging
Other Preparation of the body
-cosmetic work -washing and disinfecting instead of embalming
Casket Price List (CPL)
-descriptive info must be sufficient to identify it -a photo and model number - not enough -only caskets that do not require special ordering must be listed -except for the rule that you must make an alternative container available for direct cremation, you do not have to offer any particular caskets -no required format or order to list -list can be offered in any manner
State Exemptions
The FTC may grant a statewide exemption if it finds that: -there is a state requirement in effect that applies to the same transaction that the Rule covers and -the requirement provides an overall level of protection that is greater than or equal to the Rule
Comprehension of Disclosures
-disclosures must be clear and conspicuous -disclosures must be legible -price lists may not include any information that alters or contradicts the information the Rule requires -you can include other information on your price lists
Consumer Friendliness - Misleading Language:
-do not claim that caskets or OBC will fully protect body -use the word gasket instead of protective or sealers -consider using the language "no casket or vault will prevent a body from decomposing, and no casket or vault will permanently keep out air, water, and earth"
Consumer Friendliness
-don't make your basic service charge outrageous -make sure you offer enough moderately priced caskets -receiving remains should be less than forwarding -cremations should include the crematory fee in your price
VIOLATIONS Services and Facilities for viewing:
-facilities fee and use of funeral director and staff must be combined into one fee -funeral homes may still have multiple listings for use of facilities depending on the visitation -charges for arranging the visitation are combined with the facilities and equipment fee
Compliance Tips - No fuel surcharges:
-fuel surcharges are not allowed -higher fuel costs should be adjusted in the cost of transportation -GPL date should be updated
GPL and Pre-Need
-give out in all pre-need situations -a pre-need GPL can be different from your regular GPL if the services and goods you sell are different -GPL must be given to anyone who wishes to modify their pre-need agreement
Compliance Tips - Casket Price List:
-hand it out when you begin discussing caskets -hand it out before consumers are shown caskets
Prior approval for embalming - After embalming the body, you obtain subsequent approval. However, you must tell them that:
-if they select a service that requires embalming, you will charge a fee -if the service does not require embalming, then you will not charge them -if the family expressly approves embalming or chooses services where embalming is required, you may charge them
VIOLATIONS Embalming:
-if your state requires embalming by local law, this info should be given in addition to the mandatory disclosure -additional restoration fees should be listed on GPL -Americans w/ Disabilities Act prohibits extra charges for embalming people w/ contagious diseases -you cannot imply that embalming eliminates health hazards, there is no evidence unembalmed bodies create health hazards
Basic Services of Funeral Director and Staff
-includes common funeral home services -should include ordinary sheltering of remains -may include non-itemized overhead costs -this is the only non-declinable fee you can list
Alternative Container Disclosure
-informs consumers that they may use alternative containers for direct cremations -this disclosure should be in immediate conjunction with the prices for direct cremation -you must describe what containers you offer -not necessary if you do not offer direct cremation
VIOLATIONS Basic services of Funeral Director and Staff:
-if you make the services non-declinable, you must incorporate all overhead costs -"Additional Services Fee" must also be incorporated -you must alert consumers of the addition of this fee to caskets if that is your price structure -you must alert customers if you are adding this to more basic services such as direct cremation -all of this fee must be included in all of your services
Misrepresentations Prohibited by the Rule: Cash Advance Items
-if you mark up the charge on cash advance items or receive a commission, discount or rebate you can not state that the price charged for the cash advanced item is the same as your cost -if the one of these situations is applicable, you must include the mandatory disclosure on your Statement of Funeral Goods and Services
Statement of Funeral Goods and Services
-an itemized list of what goods and services the consumer has selected -there is no specific form, heading or caption required -can be included in any contract or other document that is given to the customers at the end of arrangements -statement given when meeting face to face (mailing does not comply with rule) -Rule does not address manner or timing of payment -if arrangements are done at a distance, consumer should get a statement ASAP
Alternative container
-an unfinished wood box or other non-metal receptacle without ornamentation or fixed lining which is designed for the encasement of human remains
Right of Selection Disclosure
-informs consumers they have a right to select only what they want plus a non-declinable basic services fee -third sentence must be in bold if the service fee is non-declinable -you may add the phrase "and overhead" after the word services if the fee includes overhead costs -should be placed directly above 16 itemized services
VIOLATIONS Other Preparation:
-any other service for other preparation of the body should be listed on the GPL -if you charge a fee for the sheltering of remains, you must list that on your GPL -you cannot force the family for sanitary care for identification
Who gets a GPL?
-anyone who asks in person who asks about funeral goods, services, or their prices -they must be allowed to keep it -does not have to be requested by anyone looking to make funeral arrangements -you must give it to them regardless of who they are
Consumer Friendliness - Do not isolate yourself to funeral professionals:
-ask your acquaintance about funerals and funeral costs -show strangers your GPL -ask people about their worst funeral experiences in order to learn from them -the Grandma test
Violations can result in fines up to how much per violation?
$10,000
Cooling Off Regulation for Door to Door Sales
-3 days to return items costing more than $25 -Also applies to the Funeral Rule
Does it apply to Pre-Needs
-FTC Rule must be followed for Pre-Needs -Rule must be followed after death of arranger if arrangements are to be altered -You must follow the rule even if you are only selling pre-needs on behalf of funeral home -Does not have to be followed for pre-needs signed before 1984 unless they are to be altered after 1984
Undercover Shopping Myths
-FTC is more likely to inspect funeral homes within 100 miles of a regional center -change of ownership triggers an inspection -having package price lists in the front part of the GPL is a violation
Identifying Info Required:
-Name, address, and the telephone number for funeral provider -Should include the address and number of all branches -Language identifying it as a GPL -The effective date of the GPL
Alternative Price Lists for Special Groups - Religious groups and memorial societies:
-it is okay to have special packages for religious groups -you must provide both price lists to anyone inquiring about funerals for members in these groups -packages maybe listed on individual lists or on the GPL
Compliance Tips - Casket Catalogs:
-it must include the funeral home's name on the first page -it must include the funeral home's retail prices -it must include an effective date
Consumer Friendliness - No confusing packages:
-keep them in one place -don't overload people with packages before the itemized sections -don't assume your version of traditional is the same as other people's
Outer Burial Container Price List (OBCPL) Disclosure
-like the CPL, outer burial containers can be on the GPL or in a separate list -must disclose a list is available at the funeral home -either the GPL or OBCPL must have the following disclosure
Purpose of FTC
-maintain free and fair competition amongst businesses -take action against monopoly, restraint of trade or unfair practices -prevent anti-competitive trade in the market to protect consumers
Consumer Friendliness - Pointless Fillers:
-makes you sound phony -have sincere sounding introductory text if necessary
Third Party Caskets (things you can do)
-may attempt to persuade family to buy your casket by comparing quality and pricing -may have the family sign a form authorizing the funeral home to receive casket (form can relieve the funeral home of an obligation to inspect casket) -if casket damaged, you should point it out immediately to both family and supplier -may use a receipt of third party merchandise form that acknowledges that it doesn't constitute legal acceptance of the casket
The FTC Rule prohibits:
-misrepresenting legal, crematory, and cemetery requirements -embalming for a fee without permission -requiring purchase of a casket for direct cremation -requiring the purchase of certain funeral goods and services as a condition for furnishing other goods and services -engaging in other unfair or deceptive practices
Immediate Burials
-must include a price where purchaser provides the casket -separate price for each type of immediate burial you offer
Direct Cremation
-must include a price where the purchaser provides the container -a price for each type of direct cremation offered -if you include the actual cremation, the words "and cremation" must be added -you may use the crematory cost as a cash advance item
Casket Price List (CPL) must include basic info:
-name of the business -captioned "Casket Price List" -effective date -the retail price of each casket and alternative container that does not require special ordering, with enough information to identify it
Outer Burial Container Price List (OBCPL) must include basic info:
-name of your business -the caption "Outer Burial Container Price List" -the effective date -the retail price of any container that does not require special ordering -also disclosure
Third Party Caskets (things you cant do)
-never refuse service to family -not attempt to dissuade a family from buying a third party casket -may not require a family to be present when casket is delivered -Funeral home may not impose any restrictions on the time or manner of delivery outside normal delivery policy -no handling fees are allowed -no unreasonable package discounts for people who purchase a casket through funeral home
What Consumers Cannot be Required to Purchase
-no unwanted or unneeded goods and services to get the items they want -you cannot provide services to a consumer in the condition they purchase something from you -you cannot refuse to serve a family on the basis they refuse to purchase something from you -you cannot include the charge for an optional service as part of your non-declinable service fee
What Consumers Cannot be Required to Purchase - Exceptions to the consumer's general right to choose:
-non-declinable basic services fee -items required by law, cemetery, or crematory -impossible, impractical, or excessively burdensome requests, however you are free to comply with these requests
Other Misrepresentations
-other misrepresentations not specifically prohibited are also illegal -consumer protection laws also prohibit deceptive practices
Clayton Anti Trust Act
-price fixing, discrimination, and unfair business practices (1914)
Alternative Price Lists for Special Groups - Government agencies and packages:
-prices can be on GPL, CPL, OBCPL or separate list -package price lists must be accompanied by a GPL -packages must be offered in addition to, not in place of itemized services -if the consumer makes adjustments to a package, then return to an itemized GPL
Robinson-Patman Act
-regulates against price discrimination
Fair Credit Reporting
-regulates the collection and dissemination of consumer credit
Embalming Statement Disclosure
-relates to embalming and the need for prior approval -form should state the reason for embalming
Cash Advance Items Disclosure
-relates to your charges for buying cash advanced items -if you charge for obtaining, receive a rebate, commission, or trade or volume discount for a cash advance item you must disclose -must be in conjunction with cash advance prices and specify which ones
Funeral services are:
-services used for care and prep of bodies for any type of disposition -services used to arrange, supervise, or conduct funeral ceremony or final disposition
Embalming Disclosure
-tells consumers that the law usually -delete "except in special cases" from the embalming disclosure if state or local law does not require embalming for viewing or funeral -you can add info about state law requirements after the FTC disclosure -the price for embalming should be in immediate conjunction with this disclosure
Truth in Lending
-unfair credit and billing practices (1968)
Package Pricing
-you are allowed to do it -itemized selections must also be on the GPL -there is no particular location on the GPL where packages should be located -you are allowed to discount packages so they are less than itemized services you are allowed to limit them to customers who buy caskets or OBC from the funeral home -you cannot discount your basic services fee for people who buy merchandise from you
The rule covers you even if:
-you are not a licensed funeral director -even if a consumer only buys either good or services from you -even if you sell goods through one business and funeral services through another
Alternative Price Lists for Special Groups - Children and Infants:
-you can set different prices for children and infants -can place these items on your GPL, CPL, or OBCPL or separate -a separate list only needs to go to those inquiring about this particular arrangement
What Consumers Cannot be Required to Purchase - "Free" items:
-you cannot list any of the 16 items required to be itemized as "free" or "no charge" -because you recover the cost of "Free" items in other prices, consumers cannot reject the charge -you can list items outside of the 16 required as long as it is not against state or local laws to do so
Misrepresentations Prohibited by the Rule: Casket for direct cremation
-you cannot tell consumers a casket is required by law for direct cremation -if you offer direct cremations, you must make an alternative container available to them
Misrepresentations Prohibited by the Rule: Preservative and Protective Value Claims
-you cannot tell consumers that any good or service will delay decomposition for a long term or indefinite amount of time -you cannot tell consumers funeral goods have protective or will protect the body from grave substances when it is not true -manufacturer warranties must be made available -you should indicate that it is the manufacturer making the claims and not you
Misrepresentations Prohibited by the Rule: Embalming
-you cannot tell consumers that embalming is required by law if it is not -if state laws does require embalming, then you may tell the family about specific circumstances -you must tell the consumer in writing that it is not required by law if that is true in your state -unless state or local law requires embalming you may not tell customers embalming is required for practical purposes for: direct cremation, immediate burial, or and refrigeration is available and consumer wants a closed casket funeral w/ no formal viewing or wake
Misrepresentations Prohibited by the Rule: Outer Burial Container:
-you cannot tell consumers that state or local law requires them to buy an OBC if it is not true -you cannot tell a consumer a particular cemetery requires an OBC if that is not true -you must explain to families that a particular cemetery does require an OBC
Misrepresentations Prohibited by the Rule: Legal and Cemetery Requirements
-you cannot tell consumers that the law, a particular crematory or cemetery requires a good or service if it is not true -if you do tell them something is required, it must be in writing on the Statement of Goods and Services
Casket Price List (CPL) - caskets to list:
-you do not have to list caskets you no longer sell but have an inventory to meet existing pre-need contracts -you do not have to make a new list if you are no longer selling a casket you have listed -if a casket comes in a variety of different formats, you do not have to list each variation, just note the fact on the list
Casket Price List (CPL) Disclosure
-you may list individual casket prices on the GPL -tell consumers that there is a separate CPL -if there is a separate CPL, the GPL must include a price range -a disclosure must read "a complete price list will be provided at the funeral home" -consumers are not required to have a CPL to keep
Telephone Price Disclosures
-you must give consumers accurate info from your GPL, CPL, and OBCPL over the phone -you can ask but not require them to identify themselves before giving info -you cannot require them to come to the funeral home before giving info -if you are using an answering machine or service, you must address each caller individually -employees can take a message to be addressed later -do not need to give prices and info after hours
Outer Burial Container Price List (OBCPL)
-you must give enough descriptive info about each OBC to identify specific container -you only need to offer the ones that do not need special ordering -you in fact, do not need to sell OBC at all -you do not need to list OBC that are in inventory for meeting existing pre-need contracts but are no longer for sale -the list can appear in any form as long as it is labeled -the rules for use mirror that of the CPL
Recordkeeping
-you must keep price lists at least one year from the date you last distributed them -you must keep a copy of each Statement of Funeral Goods and Services Selected for at least one year from the date of arrangements -they must be available to FTC agents upon request
Casket Price List (CPL) - when to offer it:
-you must show the CPL to anyone who inquires about caskets or alternative containers and their prices -you must offer it before you show them and begin selling them -consumers should not learn of casket prices by reading cards placed in the caskets or having the funeral director recite them orally -if you use a manufacturer's or supplier's showroom outside of the funeral home, you must offer a CPL before discussion begins -give a CPL to anyone who wishes to modify the casket selection on a pre-need
6 Misrepresentations Prohibited by the Rule
1) Embalming 2) Casket for direct cremation 3) Outer Burial Container 4) Legal and Cemetery Requirements 5) Preservative and Protective Value Claims 6) Cash Advance Items
3 Statements Disclosures:
1) Legal Requirements 2) Embalming 3) Cash Advance Items
6 Required Disclosures on the GPL
1) Right of Selection 2) Embalming 3) Alternative Containers 4) Basic Services Fee 5) Casket Price List (CPL) 6) Outer Burial Container Price List (OBCPL)
Prior approval for embalming - You can charge a fee for embalming in one of the three circumstances:
1) State or local law requires it under the particular circumstance 2) You have obtained prior approval for embalming or authorized representative, you must get express permission in this case 3) All of the following apply: -unable to contact family member or authorized person after exercising due to diligence -you have no reason to believe the family does not want embalming
Cost Information
Cash advance items are goods and services that are obtained from a third party that you pay on the consumer's behalf. Examples: -Clergy -Obituaries -Death Certificates -Permits If you do not know the amount, a good faith estimate is acceptable but a written statement of charges should be given before the final bill
1972
FTC begins review of current funeral legislation
1964
FTC concludes funeral regulation is best at state level
1976
FTC conducts hearings on Trade Regulation Rule nationwide
1914
FTC created by an act of Congress (Clayton Anti-trust Act)
July 1973
FTC initiates non-public investigation into funeral service
1977-1979
FTC receives temporary funding to operate, negative sentiment towards them begin. The Russo Amendment passes in the House of Representatives, would have exempt funeral service
April 30, 1984
Full Funeral Rule takes effect
Basic Services Fee Disclosure (Option 1)
If you list a separate basic services fee and the charge is non-declinable: -Must appear in conjunction with the price of the basic services fee -if it is non-declinable it must also include charges for overhead not allocated anywhere else -must include the word overhead
1975
Initial proposed Trade Regulation Rule published
Basic Services Fee Disclosure (Option 2)
Instead of charging a separate fee, you include it with your casket prices: -should include all charges for the recovery of overhead costs -first sentence must be in bold -prices must appear next to the individual casket prices or price range on the GPL if you have a separate casket price range
1974
Magnusson-Moss Warranty Act / FTC Improvement Act gives FTC power to create Trade Regulations Rules. FTC calls for complaints about funeral service, receives 144
When should the GPL be offered?
Once you begin to discuss the following: -type of funeral or disposition that you can arrange -specific goods and services offered -the prices of those goods and services -a face to face meeting anywhere can require a GPL
2008
Review of Funeral Rule closed with no changes
July 19,1994
Revised Rule takes effect
1938
Wheeler-Lea Amendment adds scope of FTC as it applies to unfair and deceptive practices
Phone and mail inquiries
You are free to send one to whomever requests one however: -you must give certain info over the phone but you are not required to send them a GPL -you do not have to send a GPL to mail inquiries -you must give one if the inquiry is followed by a face to face meeting -some states require mailing a GPL upon request
Federal Trade Commission (FTC)
consists of five commissioners appointed by the President for a seven year term
16 Required Itemized Prices on the GPL
forwarding of remains / receiving of remains / direct cremation / immediate burials / basic services of funeral director and staff / transfer of remains to funeral home / embalming / other prep of the body / use of facilities and staff for viewing / "..." for funeral ceremony / "..." for memorial services / use of equipment and staff for graveside service / hearse / limo / casket prices / outer burial container
You are not required to give a GPL if: (Exception)
you are making a removal and just requesting permission to embalm, but you must disclose embalming is not required by law and refrain from any further discussion of prices and services
