|From: "bjohnson" <email@example.com>
Date: Tue, Aug 3, 1999 1:50 PM
Date: August 3, 1999
Subject: 16 CFR Part 453 Comments
Bradly T. Johnson
Secretary, Federal Trade Commission
Submitted by Email to: <firstname.lastname@example.org>
Subject: 16 CFR Part 453, Comments Concerning Trade Regulation Rule on Funeral Industry Practices
Shultz-Vogel-Johnson Mortuary is a Funeral Home in a small town in Nebraska. We handle on average of 31 Funeral cases per year. I am responding to the Federal Trade Commissions request for comments.
I shall now respond briefly point-by-point to most of the questions you posed in your request for comments. For clarity, FTC questions are repeated in lower case, and our brief responses are given in upper case letters:
(1) Is there a continuing need for the Funeral Rule? YES, THERE DEFINITELY IS.
(a) What benefits, if any, has the Rule provided to purchasers of funeral goods and services? IT HAS HELPED PEOPLE RESIST PREDATORY SALES TECHNIQUES AND HELPED THEM GET FAIR PRICES.
(b) Has the Rule imposed costs on purchasers? IF SO, ONLY MINIMALLY.
(2) What changes, if any, should be made to the Rule to increase the benefits of the Rule to purchasers? THE FUNERAL RULE SHOULD INCLUDE ANOTHER ASPECT WHICH AFFECTS THE GENERAL PUBLIC*S ABILITY TO PURCHASED FUNERAL RELATED ITEMS. CASKET STORES AND CEMETERIES SHOULD ALSO BE CONSIDERED AS PART OF THE FUNERAL INDUSTRY AND THEREFORE BE REGULATED AND REQUIRED TO ADDRESS THEIR SELLING IN AT-NEED SITUATIONS (AS FUNERAL HOMES ARE) BY OFFERING G.P.L.*S. PRE-NEED SELLING SHOULD ALSO REQUIRE THEIR PURCHASE OF MERCHANDISE (FUNDS) BE DEPOSITED IN F.D.I.C. INSURED OR INSURANCE APPROVED ACCOUNTS FOR FUTURE USE. THAT THESE FUNDS SHOULD BE CONSIDERED TRUST FUNDS UNTIL THE THEY ARE NEEDED. CURRENTLY PURCHASED MERCHANDISE IS BEING BOUGHT AND PAID FOR AND THE POSSIBILITY OF THE CASKET STORE OR OTHER MERCHANDISER BEING OUT OF BUSINESS LEAVES THE CONSUMER HANGING OUT TO DRY. OUR INDUSTRY IN NEBRASKA IS REQUIRED TO TRUST ALL BUT 15% OF THE PURCHASE TO TRUST, THERE CURRENTLY IS NO SUCH REQUIREMENT FOR THESE MERCHANDISERS OF FUNERAL GOODS.
(a) How would these changes affect the costs the Rule imposes on the funeral providers subject to its requirements? MINIMALLY. IT MERELY REQUIRES HONESTY AND OPENNESS BY ALL MERCHANDISERS.
(3) What significant burdens or costs, if any, including costs of compliance, has the Rule imposed on funeral providers subject to its requirements? NOTHING VERY SIGNIFICANT TO THE HONEST AND ETHICAL PROVIDERS.
(a) Has the Rule provided benefits to such funeral providers? YES, IT ALLOWS HONEST AND ETHICAL PROVIDERS TO HAVE FAIR COMPETITION WITH THE "ETHICALLY-CHALLENGED" PROVIDERS ON A LEVEL PLAYING FIELD.
(4) What changes, if any, should be made to the Rule to reduce the burdens or costs imposed on funeral providers subject to its requirements? A PROVISION TO INCLUDE ALL PROVIDERS OF FUNERAL GOODS OR MERCHANDISE IS THE CHANGE THAT IS NEEDED TO INCLUDE ALL PEOPLE WHO PROVIDE FUNERAL MERCHANDISE TO THE CONSUMERS.
(a) How would these changes affect the benefits provided by the Rule? IT WOULD BROADEN COVERAGE AND IMPROVE THE BENEFIT TO THE CONSUMER.
(6) Since the Rule was issued, what effects, if any, have changes in relevant technology or economic conditions had on the Rule? CONTINUED MERGERS AND ACQUISITIONS WITHOUT DISCLOSURE OF OWNERSHIP TO THE PUBLIC MAKES IT HARDER FOR CONSUMERS TO MAKE FAIR COMPARISONS.
(7) What significant burdens or costs, if any, including costs of compliance, has the Rule imposed on small funeral providers subject to its requirements? I BELIEVE THAT THE COST IS MINIMAL. THE RULE HAS MADE ALL FUNERAL PROVIDERS TAKE A LOOK AT WHAT COSTS ARE INVOLVED AND HAS LEAD TO A POSITIVE FOR THE FUNERAL INDUSTRY. A NEED FOR COMPLIANCE BY ALL PROVIDERS OF GOODS IS NEEDED TO BRING ABOUT A MEANINGFUL ATMOSPHERE OF CONSUMER PROTECTION.
(a) How do these burdens or costs differ from those imposed on larger funeral providers subject to the Rule's requirements? LARGER PROVIDERS CAN SPREAD COSTS WIDER, OR PREPARE FORMS AND SUCH CENTRALLY FOR ALL OPERATIONS. THEREFORE, LARGER FIRMS HAVE A DISTINCT ADVANTAGE WITH REGARD TO THE COST PER CASE OF PERSONNEL AND MERCHANDISE.
(8) To what extent are the burdens or costs that the Rule imposes on small funeral providers similar to those that small funeral providers would incur under standard and prudent business practices? SHOULD BE SIMILAR IF "STANDARD AND PRUDENT" PRACTICES MEANS "HONEST AND ETHICAL" PRACTICES.
(9) What changes, if any, should be made to the Rule to reduce the burdens or costs imposed on small funeral providers? AT THIS TIME THE ONLY NEED FOR CHANGE THAT I CAN SEE IS THE UNFAIR TRADE PRACTICE THAT IS ALLOWED TO CASKET STORES AND CEMETERIES WITH REGARD TO THEIR SELLING OF FUNERAL GOODS. (DISCUSSED IN 2 ABOVE), SINCE THE SMALL FUNERAL HOME OPERATES ON A SMALLER MARGIN OF PROFIT. THE LOSS OF ONE CASE HAS A MORE SIGNIFICANT DETRIMENT TO OUR BUSINESS THAN THAT OF A LARGER FUNERAL PROVIDER. A NEED FOR A LEVEL PLAYING FIELD AS TO THE WAY IN WHICH FUNERAL MERCHANDISE IS PURCHASED WILL LEVEL THAT FIELD.
(a) How would these changes affect the benefits of the Rule? POSITIVELY.
(b) Would such changes adversely affect the competitive position of larger funeral providers? NOT IF THEY ARE HONEST AND ETHICAL.
(10) How, if at all, has the Rule affected the relative number of consumers who contact more than one funeral home before deciding which one to use? IT HAS CLEARLY INCREASED THE NUMBER.
(11) How, if at all, has the Rule benefited consumers by:
1.. Alerting consumers to the importance of price information and ensuring that they obtain such information at the critical point of choosing a provider? IMPORTANT.
(b) Providing information about different purchase options? IMPORTANT.
(c) Protecting consumers from injurious misrepresentations? WEEDS OUT THE UNETHICAL PROVIDERS, AND PROVIDES A BASIS FOR RECOURSE.
(d) Requiring authorization prior to embalming? A NECESSARY DIRECTION.
(e) Prohibiting providers from conditioning the purchase of a wanted item on the purchase of an unwanted item? A CONSUMER BENEFIT.
(12) How have prices changed (in total and for specific funeral goods and services) since the Rule was amended in 1994? To what extent, if at all, are these changes attributable to the Rule? FUNERAL PRICES HAVE CHANGED NOT BECAUSE OF THE CHANGES IN 1994, BUT HAVE INCREASED THE AWARENESS BY FUNERAL PROVIDERS ON HOW CONSUMERS WISH TO BE INFORMED OF CHANGES. WHERE PROVIDERS OFFER ALTERNATIVES FOR THE CONSUMER TO MAKE THE CHOICES THEY WISH.
(13) Have the relative prevalence of: (a) ground burials; (b) cremations; (c) above-ground entombment; or (d) other dispositions, increased or decreased since the Rule was amended in 1994? GROUND BURIAL IS MORE PREVALENT IN MY AREA, CREMATION HAS GROWN, NO ABOVE GROUND ENTOMBMENT, OTHER DISPOSITION HAS GROWN. To what extent, if at all, has the Rule influenced these changes? MOST OFTEN DUE TO FAMILY OR DECEDENTS WISHES. WHICH OF COURSE VARY, CASE BY CASE.
(14) How, if at all, since the Rule was amended in 1994, have the following factors changed?
(a) The number, size, and type of providers of funeral goods and services in the industry? ABOUT THE SAME IN NEBRASKA, EXCEPT MORE INDEPENDENT CASKET SELLERS NOW COMPETE WITH FUNERAL HOMES. A CONSIDERABLE NUMBER OF NEW SMALL INDEPENDENT PROVIDERS HAVE OPENED BUSINESSES.
(b) The ability of new providers, both traditional and non-traditional, to enter the industry? IMPROVED.
(c) What types of non-traditional entrants have appeared in the industry, and how are they different from traditional providers? INDEPENDENT CASKET MAKERS AND SELLERS ARE OPENING BUSINESSES.
(d) Mergers and other types of consolidation in the funeral industry? WAS STILL INCREASING IN NEBRASKA, BUT PERHAPS SLOWING DUE TO CONGLOMERATE STABILITY QUESTIONS.
(e) Profits of funeral industry members? ABOUT THE SAME.
(15) How, if at all, has the Rule affected the cremation industry? IT PROBABLY HAS NOT, MUCH. Should the Rule be amended to include within its scope unfair and deceptive practices by crematories, if any? NOT NEEDED AND ARE EXPOSED. THE UNETHICAL AND DECEPTIVE CREMATORIES ARE WEEDED OUT BY THEIR EXPOSED AND UNFAIR PRACTICES.
(16) To what extent are providers of funeral goods and services complying with the Rule overall, and with each of its component requirements? THE RULE WHOLLY MISSES THE PROVIDERS OF FUNERAL GOODS THAT ARE NOT FUNERAL HOMES, THIS IS A TOTAL DISREGARD FOR THE RULE AS IT IS INTENDED TO PROTECT THE CONSUMER IN ITS DEALING WITH ALL PROVIDERS NOT JUST A SELECTED FEW.
(17) What difficulties, if any, are providers of funeral goods and services experiencing in complying with the Rule? DIFFICULTY INCLUDES THE NON COMPLIANCE TO THE SELLING OF FUNERAL GOODS BY STORE FRONT OR CEMETERIES TO THE GENERAL PUBLIC. THIS SHOULD BE CONSIDERED A DIRECT VIOLATION AND SHOULD BE ENFORCED AS A VIOLATION.
(18) How has the National Funeral Directors Association's Funeral Rule Offenders Program ("FROP") affected compliance with the Rule, if at all? HAS TAKEN THE NON CORRUPT AND GIVEN THEM A WAY IN WHICH TO SAVE FACE AND LEARN THE CORRECT WAY IN WHICH TO PRACTICE.
(19) Do consumers who receive itemized price information at the inception of the arrangements conference tend to spend less on funerals than those who receive such information later? PERSONAL CHOICE, MONEY AVAILABLE FOR PURCHASE AND THE INFORMATION THAT IS PROVIDED ARE THE FACTORS WHICH GUIDE CONSUMERS IN ALL PURCHASES. WHETHER THEY SPEND MORE OR LESS IS ONLY DECIDED BY THEIR OWN INFORMED CHOICES.
(20) Do consumers who make pre-need arrangements spend less on funerals than those who do not? SOMETIMES YES AND NO. If so, why? THE PRE-NEED ARRANGER MAKES A DECISION WITH A CLEAR MIND ON WHAT THEIR PERSONAL CHOICES ARE, THOSE THAT DO NOT MAKE THE DECISION TO PRE-NEED ARRANGE HAVE DECIDED THAT THEIR INPUT IS NOT A SIGNIFICANT FACTOR IN THE ARRANGEMENTS PROCESS. Does receiving price information at the inception of a pre-need arrangements conference contribute to decreased spending? SOMETIMES, IT DOES HOWEVER OFFER AND INFORMED DECISION NO MATTER WHAT THE CHOICE MIGHT BE. Does it encourage or facilitate comparison shopping? YES AND NO, IT GIVES INFORMATION THAT MAY BE USED TO COMPARISON SHOP OR IF VALUE IS SHOWN AND SAVING PERCEIVED IT IS NOT NECESSARY FOR A COMPARISON.
(21) Should the requirement that itemized price lists be given to consumers at the beginning of discussions about funeral arrangements be modified? NO. If so, how? What would be the relative costs and benefits of such a modified provision? MINIMAL.
(22) Should the Commission expand the definition of "funeral provider" in order to bring non-traditional members of the funeral industry within the scope of the Funeral Rule's coverage? ABSOLUTELY YES. Are consumers being harmed by the current limitation on the scope of the Rule's coverage? YES, ESPECIALLY WHEN ONE ENTITY CONTROLS THE FUNERAL HOME AND CEMETERY. AN ENTITY IS ALLOWED TO OPEN A RETAIL SHOP PROVIDING MERCHANDISE AND NOT DISCLOSE PRICING OR WHETHER SHIPMENT TO THE FUNERAL HOME IS INCLUDED OR WHETHER THIS CASKET OR ONE LIKE IT WILL BE THE CASKET THAT IS PURCHASED. WHETHER THE MONEY TAKEN FOR THE CASKET PROVIDED IS GOING TO BE TRUSTED OR PUT IN THE POCKET OF THE RETAILER WHO MAY OR MAY NOT BE IN BUSINESS AT THE TIME OF NEED.
(a) What definition should be used to delineate those entities and individuals subject to the Funeral Rule? THE CURRENT FUNERAL GOODS OR SERVICES PROVIDERS - ONE THAT WILL INCLUDE CEMETERIES, CASKET SELLERS AND MONUMENT SELLERS OR ANY OTHER MERCHANDISERS OF FUNERAL RELATED PRODUCTS.
(b) What are the costs and benefits of broader definitions? COSTS WILL AFFECT ONLY THE UNETHICAL OR DISHONEST. BENEFITS ARE OBVIOUSLY THAT CONSUMERS WILL BE BETTER INFORMED ABOUT TOTAL COSTS, NOT JUST FUNERAL COSTS.
(23) Should non-traditional providers of funeral goods and services be subject to only certain provisions of the Funeral Rule? NO, SUBJECT TO ALL PROVISIONS. ALL OF THE PROVISIONS SHOULD BE MADE TO REFLECT THE PROTECTION TO THE CONSUMER OF ALL GOODS OR SERVICES PROVIDED.
(a) If so, to which provisions should they be subject? AT LEAST FULL, ITEMIZED COST DISCLOSURES AT BEGINNING OF ANY TRANSACTION.
(24) Does the prohibition on more than one non-declinable fee reduce barriers to competition and increase consumer choice? YES.
1.. Has this prohibition been effective to ensure that consumers can choose and pay for only the individual goods and services that they desire? YES.
(b) Has this prohibition been effective to protect consumers' right to decline unwanted goods and services? YES.
(c) What are the benefits conferred upon consumers or competition by this prohibition? PROVIDES THE CONSUMERS A CHOICE OUTSIDE OF THE NORMAL COST OF EACH SERVICE PROVIDED.
(d) What costs or other burdens has this provision imposed upon providers of funeral goods and services? UNKNOWN.
(25) What new fees, prices, goods or services have emerged in the sale of funeral goods and services, since the Rule was amended in 1994? NONE THAT I KNOW OF.
(26) Have the 1994 amendments been effective in prohibiting casket handling fees? YES. If so, what benefits or costs have resulted from these amendments? NONE.
(27) How widespread is it for funeral providers to offer substantial discounts on funeral packages that include a casket from the funeral home? UNCERTAIN.
(a) To what extent does such discounting tend to restrict consumers' choices? NO RESTRICTION, IT IS A 6 OF ONE ½ DOZEN OF ANOTHER. THE CONSUMER WILL EVENTUALLY PAY FULL PRICE FOR THE SERVICES PROVIDED OR THEY WILL PAY A DISCOUNTED PRICE.
(28) Should the requirement for a General Price List be modified? NO. If so, how?
(a) Are there any new fees, prices, goods or services which should be added to the General Price List requirements? NO.
1. Should the Rule require that the price of private viewing without embalming be included on the General Price List? IT COULD BE BENEFICIAL.
2. Should the Rule require that the price of donating a body to a medical school be included on the General Price List? IT COULD BE BENEFICIAL.
3. Are the Rule's requirements [(Section 453.2(b)(4)(ii)(C)] to disclose on the General Price List the price for direct cremation effective to prevent deception regarding the amount a consumer will pay to have a funeral provider dispose of a body by cremation? YES. Should the Rule also include an express requirement that the disclosed price of "direct cremation" include the actual price to have a body cremated? NO, NOT ALL CREMATORIES ARE OWNED BY FUNERAL HOMES. IT WOULD BE AKIN TO INCLUDING THE COST OF A GRAVE OPENING/CLOSING TO THE COST OF THE FUNERAL. CHARGES OUTSIDE AND SEPARATE OF THE FUNERAL HOME*S NORMAL BUSINESS ARE JUST THAT, SEPARATE.
4. Should the Rule require that the price of renting a casket in connection with a cremation be included on the General Price List? YES, IF A RENTAL CASKET IS OFFERED, BUT IT MUST BE OPTIONAL. NOT ALL FUNERAL FIRMS, (SMALL FIRMS WHO DO NOT OFFER, THERE A NUMBER OF CASKETS THAT ARE CHEAPER THAN OTHER FIRMS RENTAL CASKETS AND ARE CREMATEABLE) OFFER RENTAL CASKETS.
(b) Are there any fees, prices or services which should be deleted from the General Price List? NO.
(c) Are there any other revisions that should be made to the current provisions in the General Price List? USE OF THE TERM FUNERAL GOODS AND SERVICES, SHOULD BE CHANGED TO INCLUDE ALL PROVIDERS, THIS SHOULD BE CHANGED TO FUNERAL GOODS OR SERVICES.
(d) For any change made in response to this question, what, if any, would be the costs and benefits to consumers and to funeral providers? LITTLE COST TO THE ETHICAL AND HONEST PROVIDER. BENEFIT OF INCREASED KNOWLEDGE AND CHOICES FOR THE CONSUMER.
(29) The Rule applies to both pre-need and at-need funeral arrangements. Should pre-need and at-need consumers be treated differently? YES. If so, why? PRE-NEED CONSUMERS MUST HAVE GUARANTEES OF SAFETY AND TRANSFERABILITY OF FUNDS OR SERVICES. ALL CONSUMERS SHOULD BE SURE THAT WHEN THEY PURCHASE GOODS THAT THEIR MERCHANDISE IS EITHER DELIVERED OR MONEY SET ASIDE IN TRUST UNTIL THE TIME OF DEATH OCCURS.
(c) Can a funeral provider readily distinguish between a pre-need and an at- need customer or will this complicate compliance with the Rule? THIS QUESTION APPEARS TO ASK IF A PROVIDER WILL KNOW IF SOMEONE HAS DIED AND A FUNERAL IS BEING BOUGHT OR WHETHER SOMEONE IS MERELY PLANNING AHEAD. THE ANSWER SEEMS RATHER OBVIOUS.
(30) Are there widespread unfair or deceptive practices occurring with respect to the pre-arrangement of and pre-payment for funerals by consumers? NOT WIDESPREAD, MORE LIKE SPORADIC. What are these practices? NOT PROVIDING FOR ABSOLUTE SAFETY OF FUNDS, NOT PROVIDING FOR TRANSFERABILITY, DECEPTION ABOUT COST SAVINGS, IF ANY, GUARANTEEABILITY OF FUNERAL COSTS TO THE PRE-ARRANGED. How could these practices be remedied? A UNIFORM FEDERAL REGULATIONS ON TRUSTING THAT GOES TOGETHER WITH A UNIFORM STATE LAW. Are these remedies within the Commission's authority and jurisdiction? OTHER THAN DISCLOSURE, PROBABLY NOT. IT IS MORE UP TO THE STATES TO PROVIDE FOR SAFETY AND TRANSFERABILITY RULES. Would the benefits to consumers likely to result from such remedies outweigh the likely costs to funeral providers or other industry members? OF COURSE THEY WOULD. ETHICAL AND HONEST PROVIDERS WILL NOT BE HARMED, AND WILL BENEFIT FROM RESTRICTING THE UNETHICAL AND DISHONEST ONES.
This concludes the responses to the questions posed and I have every confidence that your commission will look out for the fair and evenly applied rules to all funeral providers as well as the funeral consumers.
Bradly T. Johnson