Ten years after the collapse of NPS, the Missouri State Board of Embalmers and Funeral Directors has a confidence problem with licensees and legislators. Licensees see a regulator that is obsessed with DBAs, renewal reports, and exams that focus on contract provisions. Legislators see a regulator that will not fulfill the SB1 mandate to protect consumers. Compounding this confidence problem, the Board staff persists in implementing changes without complying with Missouri laws.
In response to our December Regulatory Report, we received a letter written by an attorney claiming to represent the Board Chairman. The letter disputed that there is a formal review process for rules approved by the State Board. That gross misstatement of Missouri law prompted us to make several open record requests to the State Board. It is widely known that the Chairman was dissatisfied with the Division attorney formerly assigned to the Board, and we sought to determine whether the Board Chairman or Executive Director were seeking legal advice from the Division. But, the Division responded to our request by advising the Sunshine Law does not require the disclosure of communications that would be protected by the attorney/client privilege. That response begs the question whether the staff had sought legal advice, or is flying blind when implementing changes and pursuing discipline.
Our open record requests also sought communications among the Board members and staff. We hoped to learn what input was sought from members before changes were implemented by the staff. The Board did respond to those requests and we learned that changes were typically implemented without any input sought from Board members.
When NPS collapsed, the Missouri General Assembly moved quickly to establish a joint legislative committee for preneed reform. That legislative joint committee requested the State Board form a working group for recommendations to the General Assembly. The Chapter 436 Working Group met six times over the course of several months. Two hotly debated issues were whether the State Board should retain jurisdiction over preneed, and if so, whether the Board should be given preneed rulemaking authority.
The Working Group recommended that the State Board retain preneed jurisdiction so that Board’s industry members could bring their experiences to future deliberations about preneed programs. That recommendation was endorsed by Working Group representatives from the Division of Finance and the Division of Insurance. The Working Group also recommended that the State Board be given preneed rulemaking authority so that it would have flexibility in responding to issues.
But, what we have learned is that the Board staff has implemented licensing and discipline requirements without seeking input from Board members, or from the industry. Some requirements exceed the Board’s statutory authority, which suggests that the staff also acted without seeking input from the Division legal office. And, requirements impacting the industry were implemented without compliance with Chapter 536. This is not the preneed reform that the Missouri General Assembly intended. We will explore the repercussions of these failures in future posts.