Government may yet make funeral costs transparent

Shoppers routinely use the internet to compare prices, whether for appliances, cars or hotel rooms. But online pricing remains scant for funeral services, putting bereaved and vulnerable people at a financial disadvantage because they’re unlikely to haggle over costs.

Consumer advocates are hoping that may finally change because federal regulators are scheduled to take a fresh look this year at a rule that governs how funeral homes share information with the public. Advocates are encouraging an update to bring the rule into the digital age by requiring funeral homes to post detailed prices online.

“We are building a consumer coalition” to promote the change, said Steve Brobeck, senior fellow with the Consumer Federation of America.

The federation and allies like the Funeral Consumers Alliance, a nonprofit group that promotes price transparency, argue that the current rule is woefully inadequate for the internet era. The Federal Trade Commission’s funeral rule requires funeral homes to provide prices to consumers seeking them over the phone and to give an itemized price list to anyone requesting one in person. But the rule, which first took effect in 1984, when the internet was in its infancy, does not require online disclosure of prices.

The typical cost of a traditional funeral, including viewing of the body and burial, was about $7,400 in 2017, according to the National Funeral Directors Association, a trade group. A funeral with cremation, which is increasingly popular, was about $6,300. But costs vary widely, even within the same market.

Scott Gilligan, general counsel to the funeral directors association, said about 20 percent of its members — generally those in larger, competitive markets — posted prices online, but the association has not seen major demand for it from consumers. The group’s research, he said, shows that people choose a funeral home mainly because of factors like a relationship with a funeral director or a home’s location, with price a less important criterion. There are about 22,000 funeral homes in the United States, and most are family-owned, he said.

The Federal Trade Commission typically strives to re-evaluate rules every 10 years, said Patti Poss, an attorney in the commission’s consumer protection bureau. The last review of the funeral rule ended in 2008, when, according to the Federal Register, the commission declined to adopt any changes.

A review of the funeral rule in 2019 has been scheduled for several years, Poss said, and is “supposed to happen sometime this year.” She was unable to provide a date when the assessment might start, but said it would be announced on the commission’s website and in the Federal Register.

The commission typically seeks public comment to help determine if a rule remains relevant, and whether any changes are warranted. One factor it considers, Poss noted, is any effect of technology.

Joshua Slocum, executive director of the Funeral Consumers Alliance, said the rule sorely needed updating. The alliance, along with the consumer federation, petitioned the Federal Trade Commission in 2016 to speed up its review.

Slocum said posting prices online would make enforcement of the rule far easier, since regulators are able to visit just a small fraction of the country’s funeral homes to check compliance.

The commission enforces the funeral rule, in part, with undercover inspections of funeral homes. It reported last year that nearly a quarter of 134 homes in a dozen states visited in 2017 had failed to comply with federal price disclosure rules.

An analysis of 200 funeral homes last year by the Funeral Consumers Alliance found just 16 percent with websites included their full price lists online, although about a fourth posted some information, such as packaged services.

Consumer advocates say they generally support wider availability of information online but caution that third-party websites may have financial incentives to promote one funeral home over another. Slocum, of the Funeral Consumers Alliance, also said it was difficult to keep pricing information updated since doing so required companies to call or visit the individual funeral homes. As with any website, he said, shoppers should use a healthy skepticism when evaluating services.