Why Can Funeral Directors Only Manage One Home Per County?
Bill seeks to keep rural undertakers from going under
Funeral homes across the country are facing hard times, especially those in rural areas and small towns. In Michigan, legislation recently introduced by Sen. Rick Outman, R-Six Lakes, aims to ease their burdens through allowing funeral home directors to oversee more than one location.
Americans have been moving away from more elaborate burials that include viewings, expensive caskets and decorous ceremonies in favor of simpler options, most notably, cremation. Figures show that over the last 60 years, the percentage of Americans choosing cremation climbed from less than 10% to over 50%. Today, the average funeral home in America serves just 117 clients per year, or two per week. On top of that, many of these ceremonies are now for cremations instead of burials, where funeral homes make a large portion of their revenue by providing services like embalming and cosmetic reconstruction. In rural areas, especially those with a declining population, the effect of the changes has been even more profound, and many funeral homes are finding it harder to cover their operating costs.
Funeral home operators might find some relief in Senate Bill 696, which aims to ease an unusual licensing restriction that confronts rural funeral homes. Under Michigan law, licensed funeral home directors can manage only a single home, even though in rural areas, it might not get enough business to keep a director on staff full time.
Outman’s bill would allow licensed funeral home directors to apply for a permit to operate more than one home at a time, under certain conditions. They would have to live within 75 miles of both establishments, and the funeral homes must be in counties where the population density is lower than that of the state as a whole.
By operating just one funeral home in a rural area, a licensed funeral home director might barely be able to make ends meet. By allowing one license to cover two establishments, the legislation could allow directors to cut some costs and serve a larger geographic range of customers more efficiently.
Josh Slocum, executive director at the Funeral Consumers Alliance, believes that the bill is a step in the right direction. Rolling back occupational licensing laws for funeral homes benefits consumers, Slocum said in a phone interview, but it is often opposed by current operators who prefer less competition. The Michigan Funeral Directors Association supports Senate Bill 696, however.
Cana Garrison, representing the association before the House Regulatory Reform Committee on May 12, supported the bill. She said access to funeral homes in rural Michigan is in peril “due to population shifts, market trends and regulations.” Garrison added that under the bill, it would be possible to operate a funeral home without having a full-time director on site, making it easier to serve local residents.
Some other regulatory reforms could help funeral homes, regardless of whether they are in an urban or rural location. Colorado, for example, requires no license for funeral home directors. A 2017 study of the funeral industry found that after the state’s mandate was repealed in 1983, the price of a Colorado funeral declined compared to those in the rest of the country.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.