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Funeral Homes Leave Families in the Dark on Prices

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Consumers already suffering from the loss of a loved one are up against significant headwinds as they try to make funeral arrangements. A new report found only 25% of funeral homes fully disclose prices on their website, and a meager 16% fully disclose prices both on their website and in response to consumer inquiries.

The difference in cost for the same services can be extreme: from over $2,500 to almost $14,000 for a full-service funeral.

The Consumer Federation of America held on Monday a teleconference outlining the results of its report on the cost of dying in America. The report was conducted jointly with the Funeral Consumers Alliance, a nonprofit organization that aims to educate consumers on affordable funeral options.

The report examined disclosure practices at 150 funeral homes across 10 different regions: Atlanta; Denver; Indianapolis; Mercer County, New Jersey; Minneapolis; Orange County, California; Philadelphia; Seattle; Tucson, Arizona; and Washington. Funeral homes were randomly selected and included at least one large chain. Researchers made several attempts to gather pricing information, starting with examining the website, followed by an email, a phone call and in several instances, a visit to the funeral home.

Josh Slocum, executive director of the Funeral Consumers Alliance, said that shopping for funeral services is uniquely difficult for consumers, not just because of the emotional difficulty, but because funeral homes actively hide prices from consumers and “foster mistaken beliefs like ‘embalming is required by law’ or ‘viewing the body is necessary for everyone to grieve properly.’”

He noted that “with few exceptions,” researchers for the survey had to contact funeral homes in the survey repeatedly by phone and email to get pricing information, and in some cases funeral directors were so resistant to send it electronically that it took two to three weeks of contacting the same firm to get prices.

Slocum said that funeral homes often act as if they’re being persecuted by disclosure rules imposed on them. He said some of the homes took an “adversarial” tone with researchers. In one case, a researcher sent the funeral home a self-addressed, stamped envelope asking for information for a survey and requesting a price list. “Instead of doing this, the funeral home tucked her letter back into the self-addressed stamped envelope and made notes on it about how they weren’t required by law to give prices by mail, but if she wanted to travel several states away to meet them they’d be happy to.”

The Funeral Rule

Recognizing the “unique vulnerability” of consumers trying to lay loved ones to rest, the Federal Trade Commission passed the Funeral Rule in 1982, which requires funeral homes to disclose prices by phone, to give out printed itemized price lists to consumers who visit the home and “most importantly, bars the historical industry practice of funeral bundling.”

Before the Funeral Rule, Slocum said, most funeral homes sold a casket with other services included in the price whether the consumer wanted them or not. “Thirty-three years after the Funeral Rule, it’s still too difficult for consumers to compare prices,” he said.

Slocum argued that it was time for the Federal Trade Commission to update the Funeral Rule to better protect consumers in the age of the Internet.

The Internet has changed the way consumers shop for goods and services. “We know how to compare features and prices on appliances and big-ticket consumer goods, but we know very little about our options for funerals,” Slocum said.

He added that if funeral homes constructed the price lists they give consumers who visit the home the way they present them on their websites, “they would be violating federal law.”

“The pre-Internet Funeral Rule was the best we could do in a world of typewriters and telephones, but the Internet has changed everything for American consumers, except consumers of funeral services,” he said. “For them, it’s shopping by telephone or physical visits to multiple funeral homes, just like in 1982.”

Slocum noted that California has led the way in protecting funeral consumers. In 2013, it became the first — and is still the only — state to require funeral homes to put their complete general price list online or at least list the services they offer and disclose that consumers can request a complete list.

He urged the FTC to follow California’s example and update the Funeral Rule. “Any funeral home that has a website should be required to post its prices and consumer disclosures on that website,” he said.

There would be benefits to the funeral home as well as the consumer. “Posting a simple document online costs almost nothing and certainly less than cost of the paper you have to print it on, and informed consumers make satisfied customers,” he said.

Most states have funeral regulatory boards that people can complain to, Slocum said. However, he cautioned that a lot of boards “are a little bit more favorable to the industry and sometimes have significant industry influence in terms of the number of industry members who sit on the governing board.”

Consumers who do want to complain about a funeral home’s practices should “put it in writing, be specific and send the Funeral Consumers Alliance a copy,” he suggested, “because the only way consumer advocates and policymakers can understand what’s going on and what needs to be changed is when consumers voice their dissatisfaction.” 

Funeral Costs (When You Can Find Them)

As Slocum noted, most people will only shop for funeral services once in their lives, so funeral homes don’t have the incentive to keep customers for repeat business.

Stephen Brobeck, executive director of the Consumer Federation of America, added that because consumers don’t start shopping for services until after they need them, there’s been little impact on funeral homes to change how they price services.

“This is clearly not a price competitive market where consumer search drives down price to a narrow band,” Brobeck said.

The report found prices for three tiers of service: direct cremation without ceremony, immediate burial without ceremony or the cost of a casket, and full-service funeral, which includes services such as assistance from the funeral director and staff; transporting the body from place of death to the funeral home; embalming and other preparation of the body; viewing or calling hours; a funeral ceremony with the casket present; a hearse to the cemetery; a sedan or limousine for the family; and a graveside ceremony.

Only one of the funeral homes in Atlanta and Washington posted their complete price lists and disclosures online, Slocum said, and none of the homes surveyed in Indianapolis and Philadelphia did so.

The report found that within each region, prices for the same services always varied by at least 100% and were often three or four times higher.

For example, a full-service burial in Washington can be found for $3,770 or $13,800 for the exact same service. In one extreme example of price variance, in Mercer County, New Jersey, the least expensive service funeral services, direct cremation, ranged from $130 to over 33 times more expensive at $4,315.

 Range of Funeral Costs, 2015

Funeral homes try to justify the price difference by saying they provide better service, Slocum said, “but in reality, there isn’t that much difference between one basic cremation and burial or another.”

Hiding prices prevents consumers from comparison shopping. Combine that with their reluctance to think about death and burial at all, Slocum said, and “funeral homes can get away with charging prices that consumers would never unquestioningly accept in any other big purchase.”

Consumers dealing with a death in the family might also feel pressured to act quickly, but last-minute shopping can add another layer of complexity to the process.

Slocum recommended that for loved ones who died in a hospital, their family members should ask if the hospital can keep the body until arrangements can be made. “Most of the time — not always, but most of the time — they will give you a few days or up to a week. If you do not have to call a funeral home immediately, resist the urge to do that.”

Nursing homes may not be able to hold onto a family member’s body until arrangements can be made, he said.