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Guardians
An ICFA newsletter published semi-annually, Guardians is distributed to regional and state cemetery and funeral trade associations, federal officials, elected representatives and selected media. Each issue highlights recent ICFA activities on a variety of projects, including government relations, public service and consumer education.
Fall 2000
ICFA Testifies at Senate Committee Hearings on Funeral/Cemetery Industries
Industry Reps, Activists Meet for Death Care Symposium
ICFA Praises Federal Court Decision Invalidating State Casket Law as Unconstitutional
ICFA Testifies Before U.S. Department of Labor Concerning Complexities of Proposed OSHA Ergonomics Standard
ICFA Testifies at Senate Committee Hearings on Funeral/Cemetery Industries
On April 10th and 11th, the Senate Special Committee on Aging held hearings to explore the practices of funeral homes, cemeteries, and preneed sellers. This occasion marked the first time since the 1960s that a Congressional committee has focused on funeral-related industries through public hearings. Consumer witnesses and industry critics testified during the first day. They were followed on the second day by a Federal Trade Commission representative, a California state regulator, and witnesses from two trade associations, the National Funeral Directors Association (NFDA), and the ICFA. The hearings were broadcast over cable television by C-Span and could be viewed on the Aging Committee’s Web site.
The Committee on Aging is chaired by Senator Charles E. Grassley (R-Iowa) with ranking member John Breaux (D-Louisiana) working together in a bipartisan manner. Grassley stated that the hearing was not a “gotcha” type of event and noted the high level of cooperation the industry provided. The ICFA, working with Committee staff, was represented by Paul Elvig, ICFA Secretary and Board member, State Legislation and Association Chairman, and Vice President with Evergreen-Washelli Memorial Park and Funeral Home, Seattle, Washington. Elvig’s testimony is reviewed below.
Consumer Testimony
The first witness, Irwin Karp, was a convicted felon who had sold preneed cremation services and testified via video conferencing from a California prison. Karp discussed what he saw as several shortcomings that existed in California law circa 1990. He seemed unaware that most of these issues had been addressed by the state since that time and enforcement efforts increased. The consumer witnesses told of various problems, including a crypt leaking fluids in a Pennsylvania mausoleum, a California cemetery that illegally disinterred remains and resold the lots, and an elderly Florida woman (as told by a funeral director) who had signed a series of preneed agreements totaling $132,000.
The industry critics included Darryl Roberts; Father Henry Wasielewski; Lamar Hankins, president of the Funeral and Memorial Societies of America; and former AARP Board Chairman Dr. Robert Shreve. After reading his testimony, Roberts did not remain for questioning. Father Wasielewski alleged, among other things, the prevalence of what he termed “clergy-mortuary bribery.” Under questioning, AARP’s Shreve agreed with the ICFA position that the FTC Funeral Rule is an inappropriate regulatory vehicle to apply to cemeteries although he thought that all sellers should be federally regulated.
Government and Industry Testimony
On the second day of the hearings, the FTC’s Eileen Harrington, associate director of marketing practices, gave an overview of the Commission’s consumer protection activities through the FTC Act and the Funeral Rule. Mrs. Harrington chaired the Funeral Rule Review Public Workshop last November (see the previous Guardians newsletter for details). G.V. Ayers, California Department of Consumer Affairs, discussed his agency’s enforcement efforts and the benefits of a state agency having oversight of funeral homes, cemeteries and crematories.
The NFDA witness, Jay U. Jacobson, an Iowa funeral director, said he was "shocked by the lack of credible funeral service professionals invited here to give testimony." Later, Senator Breaux responded by saying, "You just don’t speak for yourself, but for 14,000 funeral directors.... Four to five people say they have complaints and now it’s your day" to respond.
ICFA Testimony (full copy of testimony available here)
The ICFA’s Paul Elvig was the final witness and complimented the Senators, saying, "We’re proud of what you’re doing here today." He urged state regulation over federal intervention and, picking up on Grassley’s idea about developing model rules for the states, discussed the ICFA Model Guidelines for State Laws and Regulations. Elvig responded to the issue of making preneed contracts portable, discussing the complexities and comparing it to transferring airline tickets from one carrier to another. He pledged that the ICFA would work with the Committee on this issue.
Elvig strongly advocated the use of prearrangements and prefunding "to assure consumers that they can control the events around them." He took "strong exception to the notion that people won’t complain" if they have experienced a problem with an industry member and said the fact that the Committee received "testimony from a man behind bars says the system works." The FTC’s Harrington agreed that there are few consumer complaints when compared with other professions and industries.
In addition, the ICFA’s written testimony discussed the findings of the U.S. General Accounting Office’s 1999 investigative report of the industry, particularly the finding of low numbers of consumers complaints. ICFA stated that "consumer education is the key to consumer protection. There exists a wide variety of options and price ranges for consumers to consider.... This information is widely disseminated by industry members, consumer groups, memorial societies and, increasingly, through the Internet. The types of arrangements selected will vary according to each individual based on his or her personal preferences, ethnic background and religious beliefs. Obviously, these decisions should not be made under the stress and bereavement of a death, or even an imminent death, in the absence of adequate thought and planning. The greatest challenge confronting the goal of consumer protection is the necessity for consumers to explore their options before the need arises."
The ICFA submitted a number of exhibits with its written testimony, including consumer and state law surveys. The testimony concluded by stating: "ICFA encourages states to develop uniform laws through its Model Guidelines and works actively with federal, state and consumer organizations, such as the Better Business Bureau, to quickly resolve consumer complaints and to prevent problems from occurring. Indications from all reliable sources, including the GAO investigative report, show persuasively that consumer problems are low in volume and are efficiently resolved."
The Committee is expected to publish a report in the near future.
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Industry Reps, Activists Meet for Death Care Symposium
On May 24th, the North American Cemetery Regulators Association, AARP, and the Consumer Federation of America (CFA) combined their sponsorships to hold the First National Symposium on Deathcare as a Consumer Issue at AARP headquarters in Washington, D.C. This event was the third in an historic trilogy of public meetings between consumer groups, industry trade associations, and government agencies held within six months.
The first two meetings occurred at the FTC Funeral Rule workshop conference in November 1999 (see the previous issue of Guardians for details) and the Senate Special Committee on Aging hearings in April (see this issue for details). Many of the same individuals represented the various organizations at all three meetings but the Symposium provided the participants with an opportunity to discuss issues out of the glare of television lights and cameras and without court reporters transcribing their statements.
The Symposium was organized as "a meaningful forum for sharing information about consumer education, consumer protection and the deathcare industry" rather than as a confrontational airing of complaints that characterized the first two meetings. Attendance was by invitation only to health care, hospice, nursing home and related agencies. Three panels made presentations: an industry panel consisting of representatives from the ICFA, the National Funeral Directors Association, the Cremation Association of North America (CANA), the Monument Builders of North America, and the National Casket Retailers Association; a consumer panel with staff from AARP, FAMSA/Funeral Consumer Alliance, the North American Cemetery Regulators Association (NCRA), and the National Cooperative Business Alliance; and a panel of government and regulatory agencies from the FTC, NCRA, the National Association of Consumer Agency Administrators, and the U.S. Senate Special Committee on Aging.
The ICFA was represented by Past President Robert A. Gordon Sr., CCFE, Eternal Hills Memorial Gardens and Funeral Home, Klamath Falls, Oregon, who is currently Chairman of the ICFA’s Inter-Allied Committee and Certification Board. Gordon gave a strong endorsement of prefunding prearrangements. "Planning to use insurance or savings to pay funeral and burial expenses at the time of need may sound like a good idea," Gordon observed, "but in many cases that money is used to pay medical bills resulting from the final illness." He also discussed the various ICFA Programs for assisting and educating consumers including handouts that were distributed to attendees. Also participating from the ICFA were Past President Robert "Ted" Nuckolls, CCE, General Counsel Bob Fells, and ICFA Managing Editor Susan Loving.
CANA Executive Director Jack Springer noted that the average wedding costs $17,000 and the average car $22,000. By comparison, Springer noted, funerals are significantly less expensive. He observed that the rise in the cremation rate stems from the fact that cremation gives people more time for planning a meaningful service and memorialization. "People aren’t necessarily trying to spend less money," Springer said, "they simply want to spend meaningful money." He pointed out that the cremation rate has increased from 12 percent 18 years ago to about 25 percent today.
Iowa regulator Dennis N. Britson, who serves as executive director of NCRA, provided an overview of his Association’s activities including the development of model policy statements. He noted that cemeteries and funeral homes have traditionally been regulated through separate statutes and regulatory agencies but this approach may be changing. Maryland Office of Cemetery Oversight Director Steven V. Sklar discussed his newly formed agency and the fact that many complaints are resolved by a simple exchange of phone calls. FTC Attorney Alan Hile outlined the ongoing Funeral Rule review proceedings, and Lauren Fuller, chief investigative counsel with the Senate Aging Committee, reviewed the recent hearings and possible follow-up.
Almost all of the participants respected the "no accusations" theme of the meeting and focused on the issues that consumers and their families need to consider when making funeral and burial arrangements. As a result, the Symposium provided attendees with some constructive networking opportunities to informally discuss issues of mutual concern. A second Symposium is anticipated for spring 2001 and the ICFA has indicated its willingness to participate.
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ICFA Praises Federal Court Decision Invalidating State Casket Law as Unconstitutional
The ICFA praised a landmark decision by the U.S. District Court for the Eastern District of Tennessee that ruled the state law restricting the retail sale of caskets exclusively to licensed funeral directors was unconstitutional. Specifically, the court ruled that the Tennessee law violated the Due Process and Equal Protection clauses of the14th Amendment to the U.S. Constitution by denying the plaintiffs, third-party retail casket sellers, the freedom to sell caskets to the public. This lawsuit marks the first time a federal court has invalidated a state law that restricts the sale of caskets and is consistent with the ICFA position supporting open competition.
Plaintiffs filed the litigation as a civil rights case challenging a section of the state statute that permits only licensed funeral directors to engage in "funeral directing," defined in part as the selling of funeral merchandise such as caskets. None of the plaintiffs held a funeral director’s license, and they had been ordered by the state funeral board to stop selling caskets until they had obtained a license. According to the court, Tennessee provides two methods of becoming a licensed funeral director: 1) Complete a course of study at an approved mortuary school and undergo a one-year apprenticeship, or 2) Complete a two-year apprenticeship program and assist in at least 25 funerals.
The court acknowledged that the state had a right to regulate casket sales provided such regulation is "rationally related to legitimate government interests." The state claimed that it had two purposes to require that only licensed funeral directors may sell funeral merchandise. "The first purpose is ‘protecting the vulnerable funeral consumer and insuring competency in the funeral services profession.’ The second is to ‘protect the public health, safety and welfare of the public.’ These are clearly legitimate governmental interests.... However, the mere assertion of a legitimate government interest has never been enough to validate a law."
The court noted that "the key issue in this case is whether the funeral merchandise sales licensure requirement is a rational means of achieving these purposes. This court holds that it is not. The requirement has nothing to do with public health and safety. A casket is nothing more than a container for human remains.... In those rare instances where human remains (before burial) might present a public health concern, funeral directors do not rely on caskets to negate the threat. Instead, they rely on embalming, adjustments to the funeral arrangements, and other arrangements such as the use of plastic encasements for the body.
"The evidence also shows that Tennessee does not really believe that caskets play any role in the promotion of public health and safety. The State does not require the use of caskets in human burials.... Moreover, the Federal Trade Commission (‘FTC’) requires funeral directors to accept caskets provided by third parties.
"Caskets, whether purchased from a funeral director or from an independent retailer, are not intended to prevent the spread of communicable diseases.... Such being the case, the purpose of promoting public health and safety is not served by requiring two years of training to sell a box. Moreover, none of the training received by licensed funeral directors regarding caskets has anything to do with public health or safety."
The State argued that the funeral law incorporates the FTC Funeral Rule written price disclosures into its requirements but that independent retailers were not covered by the Funeral Rule, thereby leaving the public unprotected. However, the court distinguished the need for the Funeral Rule to cover funeral directors while not obligating third-party sellers. "The FTC issued the Rule to prevent funeral directors from selling preselected packages of goods to consumers so that consumers were forced to purchase goods and services they did not want. Funeral providers were ‘bundling’ the cost of funerals; hence, the need to have these costs separated for consumers."
The court went further in holding that "requiring the disclosure of casket costs by independent retailers is unnecessary. The plaintiffs, as independent casket retailers, do not provide funeral services; they only sell caskets, urns, and other funeral-related merchandise. Independent retailers do not need to be compelled to disclose prices. Like any other retailers, if they fail to disclose their prices, they will do no business."
This decision, Craigmiles v. Giles, can be contrasted to a decision by an Oklahoma state court two years ago, State v. Stone Casket Co., that upheld a similar law restricting casket sales to licensed funeral directors. The Stone Casket opinion was relatively brief, offered little analysis of the issues, and merely concluded that "a casket is part of the funeral service business and cannot be separated as an independent item." By comparison, the Craigmiles opinion is lengthy and seems written by the federal district court to withstand scrutiny on appeal. At this point, it is not known whether the decision will be appealed.
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ICFA Testifies Before U.S. Department of Labor Concerning Complexities of Proposed OSHA Ergonomics Standard
On May 9th, ICFA Past President Edward C. Laux, CCE, testified on behalf of the Association before the U.S. Department of Labor public hearings in Washington, D.C., on the proposed Ergonomics program standard. The standard was developed by the Occupational Safety and Health Administration (OSHA) to reduce repetitive stress injuries, known as musculoskeletal disorders (MSDs), in the workplace. However, OSHA has stirred considerable controversy in the business community with its 300-page proposal requiring employers in manufacturing and manual handling operations to initiate a number of activities when an employee reports an OSHA-recordable MSD injury. The standard affects cemeteries, funeral homes and related facilities and contains no small business exemption.
Laux stated: "The ICFA supports efforts to identify and eliminate musculoskeletal disorders or MSDs in the workplace. However, we believe that the proposed Ergonomics program standard is both vague and unduly complicated, especially in its application to small businesses in the cemetery and funeral home industries. Statistically, there are at least 100,000 cemeteries in the United States, although the U.S. Geological Survey estimates that this number could be as high as 200,000. Many cemeteries operate through volunteer boards of directors and one or two employees. There are also at least 22,000 funeral homes, and the vast majority of cemeteries and funeral homes, approximately 87 percent, are small businesses and family-owned operations. The owners of these small businesses wear a number of hats including that of legal compliance officer for the many governmental regulations they face, including existing OSHA standards."
The ICFA acknowledged that the proposed Ergonomics standard has made some effort to accommodate the 1.3 million small businesses OSHA believes will be affected. However, Laux pointed out that "we are concerned that many owners will feel unqualified to implement the mandated requirements. OSHA has suggested that small businesses adapt the guidelines contained in its publication for meatpacking plants, an approach that we believe is inappropriate for cemeteries and funeral homes, to say the least.
"More importantly, cemeteries and funeral homes in compliance with existing OSHA safety standards have found these regulations workable because they define the potential hazard and then identify appropriate remedies. By contrast, the Ergonomics proposal would require employers to become MSD experts in identifying and rectifying potential hazards on their own.
"After the fact, OSHA personnel would inspect the work site, in effect second-guessing the employer, to determine compliance. We know of no other OSHA standards that place businesses in such a vulnerable position. Although OSHA claims that small businesses would not need to hire expensive consultants to comply, we strongly disagree. The threat of costly fines for technical infractions will force many small business owners, in our opinion, to retain ergonomics consultants to advise them."
The ICFA pointed out that cemeteries and funeral homes have a documented history of few worker injuries and this fact should be recognized in applying the Ergonomics standard to these operations. Laux stated: "Statistically, the cemetery and funeral home industries have recorded low injury rates, and, based on my own personal experiences, industry members have more often been fined for paperwork violations than for any injuries sustained by their workers due to an unsafe worksite. The MSDs covered by the Ergonomics proposal involve activities whereby tools, power lifts and other equipment have significantly aided workers and reduced the potential for injury.
"For example, the mechanical backhoe has eliminated the hand-digging of graves and consequential back injuries. However, the ICFA is alarmed that implementation of the proposed Ergonomics program will launch yet another series of costly paperwork penalties against small businesses that yield little, if any, countervailing benefits to worker safety.
"For these reasons, the ICFA supports the use of an alternative threshold test to trigger coverage under the Ergonomics program for cemeteries and funeral homes. The requirements would become effective whenever two adjudicated workers compensation MSD claims are handled within a three-year time period. This accommodation would recognize the historically low injury rate in our industries and allow small businesses to make adjustments where a problem has been detected without risking potentially costly fines for non-compliance.
"In addition, we understand that many MSDs are the result of repetitive motion tasks throughout the workday. Cemeteries and funeral homes are unique among small businesses because of the wide spectrum of tasks performed by their workers. A constant variety of office activities and field work, often by the same worker, are performed every day and eliminate the potential for repetitive motion injuries. In my opinion, it is rare for a cemetery or funeral home worker to perform only one or two tasks that would place the person at risk of sustaining a repetitive motion-type of MSD."
Subsequently, the ICFA submitted post-hearing comments in response to questions raised during its testimony. Both houses of Congress later passed legislation prohibiting the expenditure of funds by the Department of Labor from its fy 2001 budget on the Ergonomics program. At this writing, the legislation is awaiting action by President Clinton.
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Click here to see Spring/Summer 2002 edition.
Click here to see Fall/Winter 2001 edition
Click here to see Spring 2001 edition
Click here to see August 1999 edition
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