Funeral pricing transparency may tip in the favor of consumers

This centerpiece welcomes people at a Death Cafe event at the Renaissance Funeral Home in Raleigh, North Carolina in February. | Photo courtesy of Heather Hill, UNC Media Hub.

COMMUNITY NEWS

Story by Denver Dan
UNC Media Hub Student Correspondent

Both of Heidi Zanan’s parents died between 2017 and 2021, which meant she had to plan two funerals in the span of four years. Working with the funeral home left her feeling frustrated, lost and abused.

“You block out parts of it,” the 54-year-old Garner, North Carolina, resident said. And when Zanan called a funeral home to begin making arrangements for her late mother, she said, “they tried to add on expenses that I didn’t want.”

As the historically large Baby Boomer generation ages, their children are grappling with death care in increasing numbers at a moment when the funeral home industry faces disruption on several fronts.

Funeral homes are seeing more competition from large companies that have acquired what were once family-owned businesses. They are also struggling to find enough employees to meet customers’ needs and face growing competition from startups offering several new death care services that provide customers with environmentally conscious options.

All of these forces threaten the viability of the funeral home business on the eve of what could be another big change for the industry: mandated price transparency.

The Federal Trade Commission (FTC), one of the federal regulatory bodies for the death care industry, is expected to decide sometime this year whether it will require funeral homes to list their prices online.

Increased price transparency would go a long way toward helping people like Zanan, who are making financially and emotionally weighted decisions at a vulnerable time with no sense of whether they are getting a good deal or being taken advantage of.

Zanan said her parents’ funerals were pre-arranged, meaning her parents went to the funeral home, selected their preferred death care services and paid for those services in advance.

When her father died, Zanan didn’t know she was going to have to pay extra for his ashes to be put in a box. Instead, she received them in a plastic bag.

“It was clear the person on the phone wasn’t trained how to handle people in grief,” she said.

And no one had informed her parents that her children would be responsible for purchasing the death certificates, or stating how many they would need.

“They didn’t give me options,” Zanan said.

She also was led to believe she would need an extra few thousand dollars to pay for additional services, including embalming, which funeral directors can insist on even though it’s not legally required and, in Zanan’s case, there was no viewing before cremation.

Zanan’s story is unique in one important way: her parents planned and paid for their funerals in advance.

According to a 2018 National Funeral Director Association Consumer Awareness and Preferences study, only about 25% of Americans do any advanced planning for their own or their loved ones’ funerals.

That leaves many in a pinch, having to find a funeral home and choose services with virtually no opportunity to comparison shop because, in most states, they have only a couple days after a person’s death to take care of the deceased’s body.

THE DEBATE ABOUT PRICING TRANSPARENCY

The FTC’s 1984 Funeral Rule requires funeral home employees to answer a customer’s specific questions about pricing over the telephone. It also requires funeral homes to provide a general price list in person as soon as a family says they want to make arrangements or meets with a funeral director.

An FTC undercover investigation found 39 of 250 funeral homes – or 16% – didn’t reveal pricing as required by the 1984 Funeral Rule when called. And 38 of those funeral homes “either refused to answer questions about pricing at all or provided inconsistent pricing for identical services,” according to the FTC’s report issued in January.

In the fall of 2023, the FTC heard arguments for and against online pricing transparency. If the FTC decides to proceed with the change, it will issue a notice of proposed rulemaking and open public comment again, this time regarding the specifics of the proposed changes.

“It’s not that deep. People need transparent pricing. You’re required to buy it,” said Isabel Knight, president of the Home Funeral Alliance, a nonprofit that aims to educate families about death care.

Increased scrutiny and enforcement of pricing transparency are “having a moderating effect” on death care prices, according to the Competition and Markets Authority (CMA) in the U.K.

Before these efforts, funeral home prices increased at a pace almost three times higher than inflation, the CMA said. Since this increased enforcement, prices have remained steady, though it’s unclear how much of that is a result of CMA’s efforts, the pandemic or other economic forces.

Knight said she believes we would see a price drop in the U.S. with more pricing transparency.

Service Corporation International (SCI), a large publicly traded funeral home company, was impacted by the U.K. regulation and is against increased regulation around pricing transparency in the U.S.

“It should be a business decision,” said a spokesperson at SCI. “If you’re not paying online, there’s no need to have it online.

“We’re not the Walmart of the industry, we’re the Ritz Carlton,” the SCI spokesperson said. “The Ritz Carlton doesn’t put their prices online.”

Finding a general price list for SCI’s various funeral home brands online can require sifting through menus and resources, often located toward the bottom of the page.

Some of SCI’s webpages provide a great deal of information about various aspects of death care, including articles about the median costs of services.

The average cost of a funeral across the U.S. is $9,995 for a burial and viewing and $6,280 for a cremation and viewing, according to a 2023 general price list study conducted by the National Funeral Director Association.

“A funeral is the third most expensive expense for an American after a house and a car, and it’s required,” Knight said.

EMERGING ALTERNATIVES ON THE RISE

Today there are more options than ever for Americans to choose what happens to their remains, a process called disposition. Depending on where you live, a traditional funeral home is just another option.

Hunter Beatie, 38, owns Endswell Aquamation, which opened in 2023. Endswell is one of 13 aquamation centers in the U.S. and is located in Hillsborough, North Carolina.

Aquamation, legally referred to as alkaline hydrolysis, breaks down the soft tissue of the body, in what looks like a giant metal tube. The liquid is then drained and the skeletal remains are ground into a fine powder.

“It’s a gentler process on the body,” Beatie said. “Culturally, water has a lot of symbolism, too.”

It’s also far more environmentally conscious than cremation, which emits more carbon and debris into the air.

Seattle-based company Recompose is a pioneer in the emerging human composting market, also known as natural organic reduction.

The process uses 87% less energy than cremation, and saves a metric ton of carbon compared to cremation and burial, according to Recompose’s website.

The composted remains can be used in the family’s gardens or in Recompose’s conservation programs. Other companies are popping up, primarily in the Northwest, to provide human composting services.

Traditional burial almost always includes embalming, a process that “replaces organic blood with various toxic and carcinogenic chemicals, particularly formaldehyde,” all of which will inevitably leak into the groundwater, according to the Journal of Environmental Health.

Consumers can refuse embalming and choose alternative methods of burial, like green burial, which uses biodegradable coffins or shrouds that allow for natural decomposition.

More and more cemeteries are beginning to offer green burial, while others specialize in it.

Bluestem Conservation Cemetery, in Cedar Grove, North Carolina, is a nature preserve and burial ground where people can be naturally buried.

It’s also a peaceful park that promotes healing and provides a space for families to talk openly about death and grief, said Heidi Hannapel, co-director of the nonprofit that operates the cemetery.

Bluestem, the 13th conservation cemetery in the U.S., opened in 2022 and consists of 87 acres of woods, fields, walking trails and wildlife. It has approximately 6,000 burial plots on the property. The graves also don’t have headstones.

“You can’t see the burials because there’s wildflowers growing around them,” Hannapel said.

How Americans mark the death of a loved one has evolved, too.

During the pandemic, people embraced virtual funeral services. Home funerals are also increasing.

Families can have burials on their own land with the right permits in some states, according to Sara Williams, president of the Funeral Consumers Alliance.

“You are capable of doing everything yourself, you really are. This is not rocket science,” Williams said.

Some customers and industry professionals aren’t comfortable with alternatives to traditional burial and cremation, while others are embracing the change.

“We want to remain relevant,” the SCI spokesperson said. “If they want composting, if that’s what the customer wants, we want to give it to them.”

A stainless steel pressure vessel used for alkaline hydrolysis, also known as aquamation, stands at Endswell Aquamation and Cremation in Hillsborough, N.C., on January 12, 2024. | Photo by Denver Dan

While alkaline hydrolysis would “work out well” because pollution from smokestacks is a recognizable issue, human composting “just wouldn’t work in my community,” said Dr. Hari P. Close II, chairman of the board for the National Funeral Directors & Morticians Association.

With these strong opposing opinions come ongoing debates over various state and federal regulations and, thus, the future of death care.

Beatie, who sports an Endswell tattoo on his arm, is driven to reduce the environmental impact of death care. He is installing solar panels at Endswell Aquamation and taking other steps to make the business carbon neutral by the end of this year.

“This is an industry that needs to be disrupted,” Beatie said.

AN AGING WORKFORCE

Beatie is considered young for working in the death care industry.

“We are wrapping our arms around the younger generation to come take it over,” Close said.

Close was raised in the death care industry and has owned his family funeral home for 26 years. His children work in the funeral home and plan to take over the business, something that is becoming less common.

Family-owned funeral homes have been declining due to an increase in corporate acquisitions and “younger generations” who either move away from home or are uninterested in the profession.

“There’s always an ick-factor, you know, because we’ve been taught, ‘Ew they’re dead, they’re going to stink, they’re going to rot before our very eyes,’” said Williams of the Funeral Consumers Alliance.

Williams encourages people to “lose your ick-factor” because the reward of helping families far outweighs the initial discomfort.

“The biggest insult to me is, ‘I could never do that,’ ‘I don’t know how you do that.’ Well, do you like to help people? This is such a big way to help people,” said Heather Hill, a funeral director at Renaissance Funeral Home in Raleigh.

“To be able to sit in a front seat with someone at the worst time in their life is the biggest honor that you can get,” Hill said.

But funeral directors do have to handle bloody and extensively injured bodies from time to time.

“I don’t find any joy in that part,” Hill said. She also said working with families that have suffered losses related to children and suicide are especially troubling.

Other funeral directors mentioned the vicarious trauma that comes with handling the deceased.

“You can’t explain it to your family, what you see. It is overwhelming,” Close said.

Maybe the “ick-factor” is warranted, but “it’s a daily reminder how precious life is,” Hill said.

Meanwhile, companies like SCI are struggling with a staffing shortage.

“We are in crisis mode for staff,” the SCI spokesperson said. “We have 5,700 job openings in the U.S. and only 1,500 people are coming out of mortuary school each year.”

Currently, the only mortuary school in North Carolina is at Fayetteville Technical Community College. The total cost of the program is considered affordable, at an estimated $6,984 for in-state students and $20,040 for out-of-state students.

It’s the opportunity costs that many believe are expensive.

The academic program typically requires three years of full-time study, meaning a student would have to leave or delay entering the full-time workforce to attend. Then, they would have to take a licensure exam and complete a one-year apprenticeship.

That’s approximately four years without full-time pay, similar to earning a bachelor’s degree. But state licensure for funeral directors is not transferable across state lines.

“The licensing exam for funeral directors has a higher failure rate than the bar exam,” which is a major contributor to the growing staffing shortage at SCI, the spokesperson said.

“Recruitment is also difficult,” she added.

SCI and other funeral homes across the country are offering scholarships to help cover the cost of mortuary school in an attempt to recruit more staff.

“We’ve put everything back into the business so our staff gets paid well,” said Ed Kosmos, owner of City of Oaks Cremation in Raleigh.

In the Raleigh area, the average funeral director salary is approximately $64,047 a year, slightly above the average annual salary for all professions, $61,778, according to ZipRecruiter.

SCI is the largest provider of funeral, cremation and cemetery services in North America. SCI owns about 2,000 funeral homes, out of nearly 20,000 in the country, and employs about 24,900 people.

Industry professionals think the main reason corporations are going on acquisition sprees is because of the real estate value.

“Three to four times a month, I’m approached by people who are trying to buy my funeral home or the land,” Close said.

Carlton Gray, owner and funeral director at Carlton Gray Funeral & Cremation Services in Raleigh, North Carolina, said he’s also been approached by corporations looking to acquire his business.

Communities don’t always respond well to new faces in their local funeral homes. Sometimes corporations will try to sell the funeral home back to its original owner if they can’t engage with the community, according to Gray.

“In the service industry, people want to see familiar faces when they walk in,” Gray said

BEING BETTER CONSUMERS

While many debate the future of death care and how to sustain a trained workforce, everyone interviewed for this article agreed on one thing: We need to talk about death.

The FTC’s pending decision could bring those discussions to the forefront and allow consumers to plan better.

The conversation, Close said, “has to start in the home.” He also said his wife didn’t want to talk about their deaths, so he understands all too well where people are about the topic.

Families have to make 92 decisions in the funeral arrangement process, most of which have to be made at the funeral home, the SCI spokesperson said.

“It’s like planning a wedding but you have to do it in three days.”

Many said disagreements among family members over what to do with a loved one’s remains can cause fissures in relationships and severely disrupt the healing process.

“Make your plan, write it down and tell people ‘til you’re blue in the face, over and over,” Williams said.

What’s most important is that families have conversations about what they want to happen to their remains and write it down, just like they do with a will, health care power of attorney, medical orders for life-sustaining treatment and last wishes.

Still, most of the 19 people interviewed for this article said they did not have their funerals fully planned and written down.

Consumers can also pre-purchase death care services. Some say it’s a good decision, others do not.

“It gives people peace of mind. Funeral homes love it because, again, they get paid twice,” Kosmos said.

Depending on state laws, funeral directors can make a commission on a pre-need sale and then the remaining funds are transferred to a third-party trust or used to purchase a life insurance policy naming the funeral home as the beneficiary, Kosmos said.

“Paying in advance is really only necessary if somebody is maybe trying to pay for it because they don’t think there’s someone else around that can pay for it,” he said.

Instead, people should consider setting the money aside early and investing it themselves.

One idea is a variation on the 529 college savings plan which would allow people to invest tax free to grow the funds needed for death care over time, an idea proposed by Victoria Haneman, associate dean for research and innovation at Creighton University School of Law.

Haneman suggests account beneficiaries should be transferable so multiple family members’ funerals could be paid for with the investments’ earnings.

Funding matters aside, financial behavior specialists and several funeral industry professionals said consumers should never walk into a funeral home alone because they could be taken advantage of. Both their state of grief and some funeral homes’ sales tactics could make anyone vulnerable to spend more than necessary.

Another major common thread among industry professionals was the need to “demystify death” through education and proper planning.

“We need to talk about this. Get it out from behind the curtain,” Hill said.

“We live in a death-phobic society,” said Knight of the Home Funeral Alliance. “We are trying to bring conversations into communities,” including doctors’ offices and local death care groups.

Raleigh has its own Death Cafe, a monthly meetup for folks involved in or looking to learn about death care.

Outside the Renaissance Funeral Home before a recent Death Cafe meeting was a sign reading, “Relax, you’re going to die.”

Hill is the host of the Raleigh Death Cafe.

“The death rate is 100%,” Hill said. “We can live better lives if we know we’re going to die.”


Denver Dan is a documentary filmmaker and multimedia journalist pursuing an M.A. in Journalism and Media at UNC-Chapel Hill. He received the William Francis Clingman Jr. Ethics Award for his work in trauma-informed journalism and enhancing existing SPJ codes. The Local Reporter is proud to publish and promote UNC Media Hub student journalists.

Share This Article

Scroll down to make a comment.

2 Comments on "Funeral pricing transparency may tip in the favor of consumers"

  1. Funeral pricing transparency already exists. That is why I founded http://www.Funeralocity.com.

  2. I want to congratulate you, Denver, on a very detailed and comprehensive article about death care in the U.S. Your research clearly highlights some notable changes in the industry and the importance of both a sustainable approach for the future and the importance of death losing its ‘Taboo’ status and becoming something that everyone discusses and plans ahead for.

Leave a comment

Your email address will not be published.


*