Requires the Coordinator to: (1) award Federal assistance grants to State agencies that regulate death care providers; and (2) establish minimum standards and requirements governing State regulation of funeral homes and other death care providers.
Sets forth deceptive trade practices, including funeral provider practices that: (1) fail to make timely price disclosures regarding funeral goods and services; (2) fail to give an itemized written statement for retention to a purchaser of funeral goods or funeral services at the conclusion of the discussion related to such goods and services and prior to providing any services beyond taking possession of a deceased human body for authorized embalming; (3) make specified misrepresentations; (4) condition goods and services upon the purchase of other goods and services; and (5) provide embalming services without prior approval.
Prohibits unsolicited telephone offers or door-to-door direct offers to sell funeral goods, services, crematory services, interment rights, or other cemetery and memorialization goods and services.
Sets forth consumer protections with respect to certain cash advance prohibitions and requirements, and preneed and prepaid funeral service transactions.
[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 3168 Introduced in Senate (IS)]
107th CONGRESS
2d Session
S. 3168
To improve funeral home, cemetery, and crematory inspection systems, to
establish consumer protections relating to funeral service contracts,
and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
November 14, 2002
Mr. Dodd introduced the following bill; which was read twice and
referred to the Committee on Commerce, Science, and Transportation
_______________________________________________________________________
A BILL
To improve funeral home, cemetery, and crematory inspection systems, to
establish consumer protections relating to funeral service contracts,
and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Federal Death Care Inspection and
Disclosure Act''.
TITLE I--FEDERAL ASSISTANCE FOR LOCAL PROGRAMS
SEC. 101. FEDERAL COORDINATOR OF FUNERAL, BURIAL, AND DISPOSITION
OVERSIGHT.
(a) Establishment.--There is established within the Department of
Health and Human Services the position of Coordinator of Funeral,
Burial, and Disposition Services (referred to in this title as the
``Coordinator''). The Coordinator shall be appointed by the Secretary
of Health and Human Services.
(b) Duties.--The Coordinator shall ensure the conduct of the
following:
(1) A survey of existing State laws that pertain to the
death care industry.
(2) The formulation of standards specifying the elements of
an effective system for registering, inspecting, and monitoring
the handling and disposition of human remains by funeral homes,
cemeteries, crematories, and other death care providers.
(c) Report.--
(1) In general.--Not later than 8 months after the date of
enactment of this Act, the Coordinator shall submit a report to
the President and the appropriate committees of Congress
concerning the activities of the Coordinator.
(2) Contents.--The report under paragraph (1) shall
contain--
(A) a comparative analysis of existing and proposed
systems for registering, inspecting, and monitoring
death care services in the various States;
(B) a comparative analysis of State laws and
regulations requiring consumer disclosures in prepaid
funeral, cemetery, and crematory contracts; and
(C) such standards as may be formulated by the
Coordinator pursuant to this Act together with such
commentary and recommendations as Coordinator considers
appropriate.
SEC. 102. FEDERAL ASSISTANCE GRANTS.
(a) In General.--The Coordinator shall award grants to State
agencies responsible for the registration, inspection, and monitoring
of death care providers, to enable such agencies--
(1) to establish registration or licensing systems to
properly account for all funeral homes, cemeteries,
crematories, and other death care providers operating in the
State;
(2) to hire funeral home, crematory, and cemetery
inspectors;
(3) to train funeral home, crematory, and cemetery
inspectors;
(4) to hire or train consumer advocates to resolve disputes
between consumers and death care providers;
(5) to implement a new system or enhance an existing system
for receiving, investigating, mediating, or otherwise resolving
consumer complaints against funeral homes, cemeteries,
crematories, and other death care providers; or
(6) to implement a new system or enhance an existing system
for enforcing State regulations governing the operation and
practices of funeral homes, cemeteries, crematories, and other
death care providers.
(b) Eligibility.--
(1) In general.--To be eligible to receive a grant under
this section a State agency described in subsection (a) shall--
(A) submit an application for such grant to the
Coordinator for approval;
(B) certify to the Coordinator that such agency is
a unit of State government responsible for registering,
inspecting, and monitoring funeral homes, cemeteries,
crematories, or other death care providers within the
State; and
(C) maintain compliance with the standards and
requirements established under section 103.
(2) Application.--An application for a grant under this
section shall be submitted at such time, in such form, and
containing such information as the Coordinator may, by
regulation or guideline, prescribe. Such application shall
include a long-term strategy for the use of grant funds and a
detailed implementation program that reflects--
(A) consultation with--
(i) representatives from the death care
industry; and
(ii) consumers of death care services in
the State; and
(B) a consideration of a statewide strategy for
protecting the interest of such consumers.
(c) Technical Assistance.--The Coordinator may provide technical
assistance and training to a grantee under this section to assist and
measure the effectiveness and performance of programs funded under this
section.
(d) Grant Period.--A grant under this section shall be made for a
period not to exceed 3 years, but may be renewed on such terms as the
Coordinator may require.
(e) Nonsupplanting Requirement.--Amounts made available under a
grant under this section shall be used to supplement, and may not be
used to supplant, State or local funds used to carry out activities of
the type provided for under this section.
(f) Federal Share.--The Federal share of a grant made under this
section shall not exceed--
(1) for the first fiscal year for which a grantee receives
assistance under the grant, 75 percent of the total costs of
carrying out the program under the grant; and
(2) for the second and subsequent fiscal years for which a
grantee receives assistance under the grant, 50 percent of the
total costs of carrying out such program.
(g) Administrative Costs.--A grantee may use not to exceed 10
percent of the amounts received under a grant under this section for
administrative expenses, including expenses incurred in preparing
reports.
(h) Reports.--
(1) State reports.--A State agency or organization that
receives a grant under this section shall submit to the
Coordinator, at such times and in such format as the
Coordinator may require, a report that contains--
(A) a summary of the activities carried out under
the grant;
(B) an assessment of the effectiveness of such
activities in achieving ongoing compliance with the
standards formulated pursuant to section 103; and
(C) such other information as the Coordinator may
require.
(2) Report to congress.--Not later than 90 days after the
end of each fiscal year for which grants are made under this
section, the Coordinator shall submit to the appropriate
committees of Congress a report that includes--
(A) a list of the aggregate amount of grants made
under this section to each State agency or organization
for such fiscal year; and
(B) an independent evaluation of the effectiveness
of the programs that received funding under this
section in achieving ongoing compliance with the
standards formulated pursuant to section 103.
(i) Regulations, etc.--The Secretary of Health and Human Services
shall issue such rules, regulations, guidelines, and instructions, as
may be necessary to carry out this section.
SEC. 103. STANDARDS FOR STATE REGULATION OF DEATH CARE PROVIDERS.
(a) Establishment.--Not later than 180 days after the date of
enactment of this Act, the Coordinator shall establish minimum
standards and requirements with respect to the State registration,
inspection, and monitoring of funeral homes, cemeteries, crematories,
and other death care providers, including--
(1) the registration or licensing of each funeral home,
cemetery, crematory, or other death care provider with the unit
of State government charged with the inspection and monitoring
of such provider;
(2) the physical inspection, on at least an annual basis,
of the places of operation of each funeral home, cemetery,
crematory, or other death care provider which handles human
remains in the State, by a State inspector to determine
compliance with State regulations;
(3) recordkeeping procedures and annual reporting by each
funeral home, cemetery, crematory, or other death care provider
to the unit of State government charged with the inspection and
monitoring of such provider;
(4) the licensing of death care facilities;
(5) the inspection of death care facilities;
(6) the receipt, investigation, mediation, or other
resolution of consumer complaints directed at funeral homes,
cemeteries, crematories, or other death care providers
operating in the State;
(7) witnessing of cremation;
(8) the enforcement of State regulations governing the
operation and practices of funeral homes, cemeteries,
crematories, or other death care providers in the State; and
(9) other matters determined appropriate by the
Coordinator.
(b) Noncompliance.--The Coordinator shall not award a grant under
section 102 to a State agency that fails to comply with the standards
and requirements promulgated by the Secretary under subsection (a).
TITLE II--DISCLOSURE RULES FOR FUNERAL INDUSTRY
SEC. 201. DEFINITIONS.
In this title:
(1) Alternative container.--The term ``alternative
container'' means an unfinished wooden box or other nonmetal
receptacle or enclosure, without ornamentation or a fixed
interior lining, which is designed for the encasement of human
remains and which is made of fiberboard, pressed-wood,
composition materials (with or without an outside covering), or
similar materials.
(2) Arrangement services fee.--The term ``arrangement
services fee'' means a reasonable fee that--
(A) is charged to cover professional and overhead
costs, including staff time dedicated to conducting
arrangement conferences, implementing arrangement
instructions, obtaining permits or other
authorizations, preparing notices for newspapers,
coordinating with clergy and monument dealers, and
similar activities; and
(B) is--
(i) calculated at an hourly rate; or
(ii) a series of flat-rate fees for
specific arrangements made by a funeral service
provider.
(3) Cash advance item.--The term ``cash advance item''
means any item of service or merchandise described to a
purchaser as a cash advance, accommodation, cash disbursement,
or similar term. A cash advance item includes any item obtained
from a third party and paid for by the funeral provider on the
purchaser's behalf. Cash advance items include cemetery or
crematory services, pallbearers, public transportation, clergy
honoraria, flowers, musicians, singers, nurses, permit fees,
obituary notices, gratuities, and death certificates.
(4) Casket.--The term ``casket'' means a rigid container
which is designed for the encasement of human remains and which
is usually constructed of wood, metal, fiberglass, plastic, or
like material, and ornamented and lined with fabric.
(5) Commission.--The term ``Commission'' means the Federal
Trade Commission.
(6) Cremation.--The term ``cremation'' means a heating
process which incinerates human remains.
(7) Crematory.--The term ``crematory'' means any person,
partnership, or corporation that performs cremation.
(8) Deceptive practice.--The term ``deceptive practice''
means an unfair or deceptive act or practice in or affecting
commerce that violates section 5(a) of the Federal Trade
Commission Act (15 U.S.C. 45(a)).
(9) Direct cremation.--The term ``direct cremation'' means
a disposition of human remains by cremation without formal
viewing, visitation, or ceremony with the body present.
(10) Funeral ceremony.--The term ``funeral ceremony'' means
a service commemorating a deceased person that occurs with the
deceased's body present.
(11) Funeral goods.--The term ``funeral goods'' means goods
which are sold or offered for sale directly to the public for
use in connection with funeral services.
(12) Funeral provider.--The term ``funeral provider'' means
any person, partnership, or corporation that sells or offers to
sell funeral goods or funeral services to the public.
(13) Funeral services.--The term ``funeral services''
means--
(A) any services which may be used to--
(i) care for and prepare deceased human
bodies for burial, cremation, or other final
disposition; and
(ii) arrange, supervise, or conduct the
funeral ceremony or the final disposition of
deceased human bodies; and
(B) services provided by funeral directors,
morticians, cemeterians, cremationists, and memorial
retailers.
(14) Immediate burial.--The term ``immediate burial'' means
a disposition of human remains by burial, without formal
viewing, visitation, or ceremony with the body present, except
for a graveside service.
(15) Memorial service.--The term ``memorial service'' means
a ceremony commemorating the deceased without the body present.
(16) Memorial retailer.--The term ``memorial retailer''
means a person who sells or offers to sell to the public any
memorial intended to mark the location of the internment of
human remains.
(17) Outer burial container.--The term ``outer burial
container'' means any container which is designed for placement
in the grave around the casket including, but not limited to,
containers commonly known as burial vaults, grave boxes, and
grave liners.
(18) Preneed contract.--The term ``preneed contract'' means
a funeral contract arranged for and paid, in part or in full,
prior to an anticipated death.
(19) Purchaser of funeral goods or funeral services.--The
terms ``purchaser of funeral goods or funeral services'' and
``purchaser'' mean any person who--
(A) purchases funeral goods or funeral services
from a funeral provider; or
(B) contacts a funeral provider, in any manner,
including in person, by telephone, by mail, or
electronically, to obtain information related to
purchasing funeral goods or funeral services.
(20) Request for information related to funeral goods or
funeral services.--The term ``request for information related
to funeral goods or funeral services'' means any inquiry made
by a person to a funeral provider for information related to
such goods or services. Such request may be made in person, in
writing, by telephone, or electronically.
SEC. 202. PRICE DISCLOSURES.
(a) Deceptive Practices.--It shall be a deceptive trade practice
under section 5(a) of the Federal Trade Commission Act (15 U.S.C.
45(a)) for a funeral provider to fail to provide, in a timely manner--
(1) in response to a request for information related to
funeral goods or funeral services--
(A) accurate, printed information regarding the
price of the funeral goods and funeral services
described in subsection (b); and
(B) the disclosures described in subsection (c); or
(2) in response to a specific request for the prices of
caskets, alternative containers, or outer burial containers, a
list of the prices of each model of casket, alternative
container, or outer burial container that the person offers for
sale.
(b) Funeral Goods and Funeral Services.--The price of funeral goods
and funeral services referred to in subsection (a)(1)(A) means the
retail price, expressed as a flat fee or a price per hour, mile, or
other unit, of all funeral goods and services offered by a funeral
provider, including the following:
(1) Embalming.
(2) Transportation of remains.
(3) The use of facilities.
(4) Staff attendance at meetings, gatherings, or services.
(5) Equipment usage or rental.
(6) Casket and alternative containers.
(7) Outer burial container.
(8) Immediate burials.
(9) Direct cremations.
(10) Crematory services.
(11) Viewing, without embalming.
(12) Insurance or benefit processing fee.
(13) Internment rights.
(14) Opening and closing charges.
(15) Monuments, markers, or memorials.
(c) Disclosures.--The disclosures referred to in subsection
(a)(1)(B) are the following disclosures:
(1) The name, address, and telephone number of the funeral
provider's place of business.
(2) The effective date of any prices provided.
(3) The following statement: ``For information on the
purchase of funerals and consumer rights or to file a
complaint, you may contact ____________.'', with the blank
space being filled with the name, address, phone number, and
other relevant information for contacting the State agency or
agencies responsible for handling consumer inquires and
complaints pertaining to death care service providers.
(4) Contact information, including a toll-free number, for
an agency that provides information related to veteran's
benefits.
(5) In immediate conjunction with the price of embalming,
the following statements:
(A) ``Except in certain special cases, embalming is
not required by law. Embalming may be necessary,
however, if you select certain funeral arrangements,
such as a funeral with viewing. If you do not want
embalming, you usually have the right to choose an
arrangement that does not require you to pay for it,
such as direct cremation, immediate burial, or other
timely disposition.''. The phrase ``except in certain
special cases'' shall not be included in the disclosure
if State or local law in the area where the provider
does business does not require embalming under any
circumstances.
(B) ``If you selected a funeral that may require
embalming, such as a funeral with viewing, you may have
to pay for embalming. You do not have to pay for
embalming you did not approve if you selected
arrangements such as a direct cremation or immediate
burial. If we charged for embalming, we will explain
why below.''.
(6) In immediate conjunction with the price of direct
cremations, the following disclosure: ``If you want to arrange
a direct cremation, you can use an alternative container.
Alternative containers encase the body and can be made of
materials like fiberboard or composition materials (with or
without an outside covering). The containers we provide are
____________.'', with the blank space being filled with a
description of the container and its construction.
(7) In immediate conjunction with the price of any outer
burial container, the following disclosure: ``In most areas of
the country, State or local law does not require that you buy a
container to surround the casket in the grave. However, many
cemeteries require that you have such a container so that the
grave will not sink or settle. Either a grave liner or a burial
vault will satisfy these requirements.''. The phrase ``in most
areas of the country'' shall not be included in this disclosure
if State or local law in the area where the provider does
business does not require a container to surround the casket in
the grave.
(8) In immediate conjunction with the price of any casket
or sealer casket, the following disclosure: ``There is no
scientific or other evidence that any casket with a sealing
device will preserve human remains.''
(d) Timely Manner.--For the purposes of subsection (a), information
is provided in a timely manner if it is provided to the purchaser of
funeral goods or funeral services at the first opportunity, which may
not be late than the first selling, showing, or making any
representation about any funeral goods or funeral services.
(e) Specific Application.--The requirements of subsection (a) apply
to every communication between a funeral provider and a purchaser of
funeral goods or funeral services, except an in-person request made by
a funeral provider for authorization to embalm at the time a deceased
human body is removed for transportation.
SEC. 203. STATEMENT OF FUNERAL GOODS AND SERVICES SELECTED.
(a) In General.--It shall be a deceptive trade practice under
section 5(a) of the Federal Trade Commission Act (15 U.S.C. 45(a)) for
a funeral provider to fail to give an itemized written statement for
retention to a purchaser of funeral goods or funeral services at the
conclusion of the discussion related to such goods and services and
prior to providing any services beyond taking possession of a deceased
human body for authorized embalming. The statement shall include the
following information:
(1) The funeral goods and funeral services selected by the
purchaser and the prices to be paid for each good or service.
(2) A specific itemization of cash advance items to the
extent then known or reasonably ascertainable. If the prices
are not known or reasonably ascertainable, a good faith
estimate shall be given and a written statement that the actual
charges shall be provided before the final bill is paid.
(3) The total cost of the goods and services selected.
(4) If a sealer casket is selected by the purchaser, the
following disclosure: ``This product is not designed or
intended to preserve human remains, and may under certain
circumstances accelerate the decomposition of the body.''
(b) Placement of Information.--The information required by
subsection (a) shall be included on any contract, statement, or other
document which the funeral provider would otherwise provide at the
conclusion of a discussion related to funeral goods or funeral
services.
SEC. 204. MISREPRESENTATIONS.
It shall be a deceptive trade practice under section 5(a) of the
Federal Trade Commission Act (15 U.S.C. 45(a)) for a funeral provider--
(1) to inaccurately represent that Federal, State, or local
law or industry custom requires the purchase of any funeral
goods or funeral services, including to inaccurately represent
that--
(A) State or local law requires that a deceased
person be embalmed;
(B) State or local law requires a casket for direct
cremation; or
(C) a particular cemetery requires outer burial
containers;
(2) to fail to identify and briefly describe in writing on
the statement of funeral goods and funeral services selected
any legal requirement which the funeral provider represents to
a person as compelling the purchase of funeral goods or funeral
services for the funeral which that person is arranging; or
(3) to fail to disclose that embalming is not required
for--
(A) direct cremation;
(B) immediate burial; or
(C) a closed casket funeral without viewing or
visitation when refrigeration is available and when
State or local law does not require embalming; or
(4) to inaccurately represents the ability of funeral goods
or funeral services to delay the natural decomposition of human
remains for a long-term or indefinite time.
SEC. 205. REQUIRED PURCHASE OF FUNERAL GOODS OR FUNERAL SERVICES.
(a) Other Required Purchases of Funeral Goods or Funeral
Services.--It shall be a deceptive trade practice under section 5(a) of
the Federal Trade Commission Act (15 U.S.C. 45(a)) for a funeral
provider to--
(1) condition the furnishing of any funeral good or funeral
service to a person arranging a funeral on the purchase of any
other funeral good or funeral service, except as required by
law or as otherwise permitted by this title;
(2) charge any fee as a condition to furnishing any funeral
goods or funeral services to a person arranging a funeral,
other than--
(A) the fees for specific funeral services and
funeral goods selected by the purchaser;
(B) the fees for other funeral goods or funeral
services required to be purchased, as explained on the
itemized statement in accordance with section 203(a);
or
(C) an arrangement services fee that--
(i) is disclosed as being either an hourly
rate fee described in clause (i) of section
201(2)(B) or a flat fee described in clause
(ii) of such section; and
(ii) is elected by the purchaser;
(3) fail to place--
(A) immediately above the prices disclosed as
described in section 202(a), the following disclosure:
``The goods and services shown below are those we can
provide to our customers. You may choose the items you
desire. If legal or other requirements mean you must
buy any item that you do not specifically request, we
will explain the reason in writing on the statement we
provide describing the funeral goods and services you
selected.''; or
(B) in the statement of funeral goods and services
selected, as described in section 203(a)(1), the
following disclosure: ``Charges are only for those
items that you selected or that are required. If we are
required by law or by a cemetery or crematory to use
any items, we will explain the reasons in writing
below.''.
(b) Exception.--A funeral provider shall not be treated as
violating this section, if the funeral provider fails to comply
with a request for a combination of goods or services which
would be impossible, impractical, or excessively burdensome to
provide.
SEC. 206. SERVICES PROVIDED WITHOUT PRIOR APPROVAL.
(a) Deceptive Practices.--It shall be a deceptive trade practice
under section 5(a) of the Federal Trade Commission Act (15 U.S.C.
45(a)) for a funeral provider to embalm a deceased human body unless--
(1) State or local law or regulation requires embalming in
the particular circumstances regardless of any funeral choice
which the family might make;
(2) prior approval for embalming has been expressly
obtained from a family member or other authorized person;
(3) the funeral provider is unable to contact the family
member or other authorized person after exercising due
diligence and reasonably believes the family wants embalming
performed;
(4) refrigeration is necessary and is not available in the
community where the provider does business;
(b) Disclosure Required.--In seeking the approval required by
subsection (a)(2), the funeral provider shall disclose that a fee will
be charged if the family or other authorized person selects a funeral
which requires embalming, such as a funeral with a public or private
viewing, and that no fee will be charged if the family or other
authorized person selects a service which does not require embalming,
such as direct cremation or immediate burial.
SEC. 207. RETENTION OF DOCUMENTS.
A funeral provider shall retain and make available for inspection
by the Commission true and accurate copies of--
(1) the price lists required by section 202(a) for at least
1 year after the date of the last distribution of such lists to
customers; and
(2) each statement of funeral goods and services selected,
as required by section 203, for at least 1 year from the date
of arranging a funeral or memorial services.
SEC. 208. COMPREHENSION OF DISCLOSURES.
A funeral provider shall make the disclosures required by this
title in a clear and conspicuous manner using type that is not smaller
than 12 points in size. A funeral provider shall not include in any
price list, a statement or information that alters on contradicts the
information required by this title to be included in those lists.
SEC. 209. PROHIBITED SALES PRACTICES.
(a) In General.--Each of the following sales practices shall be a
deceptive trade practice under section 5(a) of the Federal Trade
Commission Act (15 U.S.C. 45(a)):
(1) Unsolicited telephone offers to sell funeral goods,
funeral services, crematory services, interment rights, or
other cemetery and memorialization goods and services.
(2) Door-to-door direct offers to sell funeral goods,
funeral services, crematory services, interment rights, or
other cemetery and memorialization goods and services.
(b) Identification of Affiliation.--A person who is an operator,
funeral provider, funeral director, embalmer, or memorial dealer
shall--
(1) state the person's affiliation with any publicly traded
company in all contracts and on all business letterhead,
advertising, and marketing materials; and
(2) state the person's licensed business location in all
directories, advertising, and marketing materials in which
offsite telephone numbers are used.
SEC. 210. CASH ADVANCE PROVISIONS.
It shall be a deceptive trade practice under section 5(a) of the
Federal Trade Commission Act (15 U.S.C. 45(a)) for a funeral provider
to--
(1) represent that the price charged for a cash advance
item is the same as the cost to the funeral provider for the
item when such is not the case; or
(2) fail to disclose to a person arranging a funeral that
the price being charged for a cash advance item is not the same
as the cost to the funeral provider for the item when such is
the case.
(3) fail to place in the itemized statement of funeral
goods and funeral services selected, in immediate conjunction
with the list of itemized cash advance items required by
section 203(a)(2), the following statements:
(A) ``We charge for our services in obtaining
________.''; with the blank space being filled with a
list of cash advance items, if the funeral provider
marks up the price for or receives and retains a
rebate, commission, or trade or volume discount on a
cash advance item.
(B) ``You have the right to arrange for the
purchase of these items on your own behalf.''.
SEC. 211. CONSUMER PROTECTIONS IN PRENEED AND PREPAID FUNERAL SERVICE
TRANSACTIONS.
It shall be a deceptive trade practice under section 5(a) of the
Federal Trade Commission Act (15 U.S.C. 45(a)) for a funeral provider
to fail to comply with the following prepaid contract requirements:
(1) Prepaid contracts shall conform to all applicable
Federal and State statutes and regulations.
(2) Prepaid contracts shall be written in plain English,
and clearly state the merchandise and services that purchasers
are buying and their prices. Use of legal or industry-specific
jargon shall be avoided to the extent possible.
(3) Charges for funeral goods or funeral services shall be
itemized. The itemization shall be in greater detail than a
recitation of prices and shall include a complete description
of the services to be rendered and an unambiguous description
of the merchandise to be delivered.
(4) When prices of merchandise or services to be delivered
in the future are not guaranteed, or an additional payment may
be required in the future, a statement to that effect shall be
included in the prepared contract and initialed by the
purchaser.
(5) The contract must clearly state what happens if
merchandise is not available at delivery time and substitution
is necessary. The description of the merchandise shall be
sufficiently complete for the person authorized to make funeral
arrangements to make a decision, based on objective criteria,
about the comparability of a needed substitution.
(6) No substitution shall be made without the consent of
the purchaser, or upon the purchaser's death, the person
authorized to make funeral arrangements. A prepaid contract
must contain a provision, which is initialed by the purchaser,
either prohibiting any changes, or, alternatively, specifying
what instructions may be modified and by whom.
(7) There shall be an explanation of how the purchaser's
funds will be protected to assure the seller's performance in
compliance with the prevailing prepaid contract law. The name
of the institution where funds will be deposited in escrow must
be disclosed. The buyer must receive an annual report from the
escrow agent. An administrative fee, not to exceed 1 percent of
the contract, may be withdrawn annually by the escrow agent.
(8) The prepaid contract shall provide for cancellation and
refund or transfer of the contract with no loss of benefits
paid by the purchaser along with accrued interest.
(9) A prepaid contract may be made irrevocable only when
the beneficiary will be applying for medicaid or other social
benefits within the next 6 months. The irrevocability of the
prepaid contract shall not affect the right of the purchaser to
change the provider.
(10) Copies of the prepaid contract and supplemental
material, such as information on credit life insurance and
transfer or exchange plans, shall be provided to the purchaser
at the time of the preneed sale.
(11) Copies of the prepaid contract and at-need
documentation shall be provided to the person authorized to
make the final funeral arrangements at the time of death to
ensure that the merchandise and services match those specified
in the prepaid contract. A list of items substituted shall be
in writing and included in the at-need documentation.
(12) Copies of all prepaid contracts and at-need
documentation shall be retained by the seller for a period of 1
year after performance of the contract.
SEC. 212. CONSUMER DISCLOSURES IN PREPAID CONTRACTS.
Not later than 1 year after the date of enactment of this Act, the
Commission shall establish minimum standards and requirements with
respect to State mandated consumer disclosures in prepaid contracts for
the purchase of funeral, cemetery, or crematory goods or services,
including--
(1) basic information identifying the seller, the
purchaser, the entity that will provide the goods and services
(if different from the seller), the prices of the goods and
services being purchased on an itemized basis, and the total
price of the purchase;
(2) funding information disclosing where, how, and with
whom the prepaid funds will be deposited and invested, and what
portion of the prepaid funds, if any, will be paid to the
seller prior to the performance of the contract;
(3) price and payment disclosures regarding to what extent
the prices of the goods and services are guaranteed or not
guaranteed, who is responsible for any payment shortfalls, and
who is entitled to receive excess funds; and
(4) cancellation and transfer information disclosing
whether the consumer may cancel or transfer the prepaid
contract, the method for exercising such rights, the amount of
revocation or transfer fees, if any, retained by the seller,
and safeguards for the consumer if the seller is unable to
provide the goods and services in the contract.
SEC. 213. PRIVATE RIGHT OF ACTION.
In addition to the remedies identified in the Federal Trade
Commission Act (15 U.S.C. 41 et seq.), a person who is injured by a
violation of this title may commence a civil action against the funeral
provider. Such person shall be entitled to recover the greater of
actual damages or $5,000 for each violation proved by a preponderance
of the evidence.
SEC. 214. ENFORCEMENT BY THE COMMISSION.
The Commission shall enforce the provisions of this title in the
manner provided in the Federal Trade Commission Act for deceptive
practices declared unlawful under section 5(a) of such Act (15 U.S.C.
45(a)).
SEC. 215. ADMINISTRATION AND RULEMAKING.
(a) Administration.--The provisions of this title shall be
administered by the Commission.
(b) Rulemaking.--Notwithstanding any other provision of law, the
Commission may prescribe rules in accordance with section 553 of title
5, United States Code (commonly known as the ``Administrative Procedure
Act'') to carry out the provisions of this title.
SEC. 216. STATE EXEMPTIONS.
A provision of this title, or a regulation issued by the Commission
pursuant to this title, shall not be in effect in a State if--
(1) the appropriate State agency requests such provision or
regulation not be in effect in the State;
(2) there is a State requirement in effect that applies to
a transaction to which the provision or regulation applies;
(3) the State requirement affords an overall level of
protection to consumers that is equal to, or exceeds, the level
of protection afforded by the provision or regulation; and
(4) the Commission determines that the State is
administering and enforcing the State requirement in a manner
that affords a level of protection to consumers that is equal
to or exceeds the level of protection afforded by the
Commission's enforcement of such provisions or regulations.
SEC. 217. DECLARATION OF INTENT.
This title does not apply to the business, or acts in the conduct
of the business, of insurance.
<all>
Introduced in Senate
Sponsor introductory remarks on measure. (CR S11084-11085)
Read twice and referred to the Committee on Commerce, Science, and Transportation.
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