Opinion 09-1

1 Staff Opinion 97-3 (Apr. 16, 1997), available at http://www.ftc.gov/bcp/conline
/edcams/funerals/opinions/opinion97-3.pdf (concluding that only funeral goods and services that
must be itemized on a funeral provider’s General Price List (“GPL”) may be discounted).
2 73 Fed. Reg. 13740 (Mar. 14, 2008).
3 Id. at 13748.
UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION
WASHINGTON, D.C. 20580
Division of Marketing Practices
Craig Tregillus 	Direct Dial: (202) 326-2970
ctregillus@ftc.gov 	Facsimile: (202) 326-3395
February 17, 2009
Pamela D. Griebel
Assistant Attorney General
Iowa Department of Justice
Hoover Bldg.
Des Moines, IA 50319
Dear Ms. Griebel:
You have requested our views on funeral providers offering discounts only to clients who
purchase a package of funeral goods and services that includes a casket. You specifically ask
whether such packages may discount the basic services fee that covers the services of the funeral
director and staff, and may include the funeral provider’s overhead.
As your inquiry notes, staff stated its view in Opinion 97-3 that the basic services fee
may not be discounted. 1 We have considered the arguments of the National Funeral Directors
Association (“NFDA”) challenging this staff opinion, and find no reason to alter this long-
standing interpretation of the Funeral Rule (“Rule”) for the reasons which follow.
First, contrary to the NFDA’s contention, the Commission’s confirmation last year at the
conclusion of its rule review that the Rule should be retained without proposing any of the
amendments sought by interested parties does not compel a different result. 2 In particular, the
Commission’s decision not to propose an amendment to the Rule that would regulate the offer of
discount funeral packages was based in large part on “insufficient evidence to show a prevalent
practice of funeral providers offering discount packages in a manner that unfairly interferes with
consumers’ ability to provide their own caskets.” 3 In retaining the Rule, the Commission simply
preserved the status quo, and did nothing to alter prior Rule interpretations. In fact, the
Commission not only cited, but expressly approved Opinion 97-3, noting that “funeral homes

Pamela D. Griebel
Page 2 of 4
4 Id. at n.93 (emphasis added).
5 Final Staff Recommendations on the Mandatory Review (May 28, 1991).
6 Id. at 39 (emphasis added).
7 See Pa. Funeral Dir.s Ass’n v. FTC, 41 F.3d 81, 89 (3d. Cir. 1994) (noting that
funeral providers can assure that consumers who buy third party caskets pay their fair share of
the provider’s overhead costs by recouping those costs in the basic services fee that “they are
permitted to charge everyone,” rather than in a casket handling fee).
8 16 C.F.R. § 453.2(b)(4)(iii)(C)(1). If the basic services fee is non-declinable, the
rule also requires a disclosure at the beginning of the GPL that “any funeral arrangement you
select will include a charge for our basic services.” 16 C.F.R. § 453.4(b)(2)(i)(A).
may encourage consumers to purchase a casket from their organization by offering discounts on
services or items except for a non-declinable Basic Services Fee.’’ 4
Second, a close reading of the precedent on which NFDA relies does not support a
different conclusion. In its report recommending the 1994 Rule amendments,5 staff did not state
or imply that the Rule permits funeral providers to discount the basic services fee in addition to
other fees for goods and services that the Rule requires or permits to be itemized in the GPL, as
NFDA contends. On the contrary, the report contemplated that funeral providers could discount
only fees for “the itemized charges required by the Rule.” 6 Similarly, the Third Circuit’s
decision upholding the 1994 Rule amendment banning casket handling fees presumes that the
basic services fee will be the same for all of a funeral provider’s clients, and that only the fees
for products and services itemized on the GPL may be discounted.7
Third, although not contesting the conclusion in Opinion 97-3 that funeral providers may
not discount only the basic service fee, NFDA contends that the opinion does not cite any basis
for its determination that when the basic services fee is combined with the fees for other funeral
goods and services in a discount package, it also may not be discounted. While we think that
Opinion 97-3 provided a clear basis for that conclusion, some elaboration may be helpful.
The basic services fee provisions of the Rule make it clear that this fee is to be the same
for each of a funeral provider’s clients. Each client must receive a GPL, and unless the basic
services fee is included in the price of the funeral provider’s caskets or is declinable, the GPL
must include the following statement: “This fee for our basic services will be added to the total
cost of the funeral arrangements you select. (This fee is already included in our charges for
direct cremations, immediate burials, and forwarding and receiving remains.)”8 Likewise, if the
basic services fee is included in the price of a funeral provider’s caskets, the GPL must include a
similar statement indicating that all of the provider’s clients must pay the same fee: “Please note
that a fee of (specify dollar amount) for the use of our basic services is included in the price of
our caskets. This same fee shall be added to the total cost of your funeral arrangements if you

Pamela D. Griebel
Page 3 of 4
9 16 C.F.R. § 453.2(b)(4)(iii)(C)(2) (emphasis added).
10 The rule does permit a funeral provider, in limited situations, to provide to
members of specified groups (e.g., children and infants, memorial society members) a separate,
complete GPL that may contain fees that are less than those listed in the GPL it provides to
consumers who are not members of such a group. Complying with the Funeral Rule, FTC (June
2004) p. 13, available at http://www.ftc.gov/bcp/edu/pubs/business/adv/bus05.pdf.
11 Staff Opinion 07-2 (March 21, 2007), p. 2.
12 16 C.F.R. § 453.2(p) (emphasis added).
13 16 C.F.R. § 453.2(b)(4)(iii)(C)(1) and (C)(2),
14 16 C.F.R. § 453.4(b)(1)(ii).
provide the casket.”9 Thus, the Rule requires that all of a funeral provider’s clients pay the same
basic services fee that is disclosed in its GPL.
Because the basic services fee disclosed in a funeral provider’s GPL must be the same for
all its clients, this fee may not be discounted.10 The Rule’s definition of “services of funeral
director and staff,” or basic services fee, provides additional support for this conclusion. As we
have noted in a prior opinion,11 the definition limits the services that may be included in this fee
to those “that are furnished by a funeral provider in arranging any funeral,” and may not include
services “included in prices of other categories in § 453.2(b)(4) [i.e., itemized services required
or permitted to be disclosed in the GPL].” 12 Likewise, it is only “unallocated funeral provider
overhead” – i.e., overhead not attributable to the itemized services required or permitted to be
disclosed in the GPL – that the Rule permits funeral providers to include in the basic services
fee.13
Thus, if the basic services fee could be discounted as part of a discount funeral package, a
funeral provider’s clients would not bear an equal share of the costs common to “any” funeral, as
the Rule plainly requires. Moreover, if such a discount package were made available only to
clients who purchase a casket from the funeral provider, clients who elect to purchase a casket
from a third party and are not eligible to receive the discount package would pay a higher basic
services fee than everyone else. The difference between such a discounted basic services fee
paid by clients who purchase a casket from the funeral provider, when subtracted from the full
basic services fee paid by those who purchase a casket from a third party, can only be regarded
as an indirect casket handling fee. Casket handling fees, whether direct or indirect, are expressly
prohibited by the Rule.14
Fourth, contrary to NFDA’s apparent impression, Opinion 97-3 is not inconsistent with
the Commission’s position, when it adopted the amendment banning casket handling fees, that
the Rule permits a funeral provider to offer discount funeral packages that are available only to
clients who purchase one of its caskets. As the Third Circuit noted, “the FTC distinguishes

Pamela D. Griebel
Page 4 of 4
15 41 F.3d at 90 (emphasis in original).
16 73 Fed. Reg. at 13748 & n.93 (noting that “[t]o the extent consumers wish to
purchase a combination of the goods and services a funeral provider offers, bundling of discount
packages likely confers benefits,” and citing staff opinion 97-3 with approval for its statement
that ‘‘funeral homes may encourage consumers to purchase a casket from their organization by
offering discounts on services or items except for a non-declinable Basic Services Fee.’’).
17 See 16 C.F.R. § 453.6.
direct casket handling fees from offering discounts to people who buy caskets from the funeral
home,” because “[t]he former is an anti-competitive penalty (the fee) and the latter is . . . .a
[pro-competitive] way to encourage consumers to buy their caskets from funeral homes.” 15
Since that time, the Commission has stated consistently that the Rule permits discount packages
conditioned on the purchase of a casket from the funeral provider, provided that the basic
services fee is not discounted, because of the pro-competitive benefits such packages provide. 16
To comply with the Funeral Rule, a funeral provider must include its full basic services
fee in the price of any discount funeral package offered, and discount only the prices itemized in
its GPL for the goods or services that are included in the package. Although nothing in the
record retention provision of the Rule requires funeral providers to create or retain a record of
what is discounted in their discount packages,17 neither does the Rule prevent providers from
maintaining such records, if they wish, in order to protect themselves from any suggestion that
they are improperly discounting the basic services fee. Funeral providers could also discourage
any such claim by including in the description of their discount funeral packages a truthful
statement that the price of their packages includes the full basic services fee.
The views expressed in this letter are those of the FTC staff. They have not been
reviewed, approved, or adopted by the Commission, and they are not binding on the Commission
or any individual Commissioner. However, they do reflect the views of FTC staff charged with
enforcement of the Funeral Rule. Staff Funeral Rule opinions are routinely posted on the FTC
website at http://www.ftc.gov/bcp/conline/edcams/funerals/staffopinions.shtm.
Sincerely,
/s/
Craig Tregillus
Funeral Rule Coordinator