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Farewell in Affordable Care (08/01 Final Condensed Proposal)

Add standard funeral service costs to packages offered in Healthcare Exchanges to reduce the financial impact funerals have on families.

Photo of Angel Landeros
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Who is your idea designed for and how does it reimagine the end-of-life experience?

This idea is designed for all people that sign up for healthcare. If basic end of life care, legal support, funerals, and all other overwhelming aspects are covered as part of healthcare, a more transparent and competitive industry would be created. It would unburden the insured and their loved ones of having to worry about paying (and most probably dealing with debt) for costly funeral services.

Imagine living through this:

“This has to be one of the worst days of my life, I loved you so much and now you are gone, I’m never going to see you again. I hate this place…why am I sitting alone in this office going over lists and lists of caskets, flowers, urns; I just want to be with my family and friends, I don’t even want to think about this!...

…Wow, this is expensive! Are these prices right? Am I being callous and cheap? You deserve the best, but I don’t know if I can afford it. I’ll find a way to make ends meet, I’ll just charge it to my credit card and figure it out later.

…It’s been a year since you passed away, it’s been really hard without you.  I wish I could spend more time with the kids, but I’m still working on paying off the 10 grand from the funeral. I’ve had to cancel vacations and get some overtime to keep us afloat…”

Average funeral costs are rising at a much higher rate than wages.  Their impact will then be ever larger on family budgets at the worst time possible. 

From 2004 to 2014 funeral costs increased 28.6% (from $5,582 to $7,181 USD) (Source) while average wages rose 30% (from $35,648.55 to $46,481.52)(Source) .  But now, the average funeral cost is closer to $10,000 USD(Source), another 39% increase in less than 2 years!

If basic funeral services were included in standard healthcare insurance policies, a lot of people would be spared the hardships that come from having to pay large and sometimes unexpected funeral costs.

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PROPOSAL

Establish a basic funeral service package that is included in every healthcare package that can be contracted through the Affordable Care Act.  The user will have the choice to OPT-OUT of the service, giving them freedom if they so please, to make arrangements separately.

The target audience of this proposal includes all people looking for coverage through healthcare packages. Ensuring basic coverage of the only sure thing everyone will need but rarely wants to think about: funerals.

By making basic funeral services a standard for most healthcare packages in the market, the following benefits should be expected:


Provide easy and no fuss coverage for most people, avoiding additional expenses that regular families normally cannot afford without putting at risk their financial stability and security.

Help bring transparency and control into an industry that can be very irregular and where people tend to over pay, as it is not something they deal with in their daily lives.

By bringing economies of scale and more control to the industry, we would force better service and prices, so even those paying for funerals separately should benefit.


INITIAL PROTOTYPING RESULTS:

A simple survey was rolled out to test the central idea behind the proposal https://www.surveymonkey.com/r/CLX858L

Would people accept to have basic funeral costs included in their Healthcare premium or would they Opt-Out?

The survey also includes a series of questions focused on gathering general demographic data to help identify any potential relation that could exist with their decision to opt out or not.

Results:

The initial survey responses provide some interesting insights into the potential impact this idea could have in people’s lives and the overall US economy.


Making funeral coverage an Opt-Out option has an over 60% success rate.

Rationale:  By the time people reach the decision of opting out of having funeral costs included in their healthcare plan, they have already chosen and are OK with paying a predetermined monthly amount for healthcare coverage.  The fact that it includes funeral costs, is a “bonus” or at least it eases the decision making process of getting done with something they won’t have to deal with later on.

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*This question has been updated to reflect a $10,000 USD average funeral cost based on the most recent data found.

Potential Impact: 

If we take the conservative side of the assumptions:

  • The average yearly number of death in the US is 2.6 Million people (Source).
  • 90% of the US population is covered by a healthcare plan (Source).
  • Each person could save at least $150 USD per funeral (avoiding embalming costs,
  • overpriced caskets, etc.).  This is on the low end considering embalming is not required and the cost range is $225-$1,200USD (Source)


Taking all of this into account, if 66% of people keep funeral costs in their insurance plans, there would be at least $230 million USD savings a year.  Every 10 USD we save per funeral, is 26 million USD a year that will be better spent or saved by US consumers.


CONCLUSIONS

Based on the initial efficacy of people not opting out of having their funeral costs covered as part of their healthcare packages, we can see that there is great potential and a real financially compelling reason to move forward with this proposal.


NEXT STEPS

Although Initial results are promising, the sample size is too small and too homogeneous to make definitive conclusions (See attached figures from Watson analytics survey assessment).  The following actions should be taken to continue with this work:

  • A new, more in depth survey should be conducted trying to reach a larger section of the US population to confirm the efficacy of the opt-out only strategy.
  • Contact major national associations (see attached list) that can help define:
  • The right base plan and price point that should be considered in the funeral services to include.
  • A realistic amount that each user could save using the basic service option.
  • The right execution structure and strategy that could be applicable for any healthcare exchange.
  • Any major roadblock that would need to be resolved to make this feasible.
  • Contact Insurance companies to help define how to bundle basic funeral services into healthcare packages.

What early, lightweight experiment might you try out in your own community to find out if the idea will meet your expectations?

This could be tested running a mock healthcare exchange, built as a survey, and letting people pick. We could identify how people react and parse out interest per demographics.

What skills, input or guidance from the OpenIDEO community would be most helpful in building out or refining your idea?

I think this is complex as it deals with public policy and a very controversial subject. With IDEOs expereince developing public policy solutions, is there another path that this might work through?

Tell us about your work experience:

I'm an engineer at a major consumer goods company. No experience in the field except what I've lived through

This idea emerged from

  • An Individual
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Attachments (4)

Watson Survey assessment.pptx

Quick data assessment done with Watson Analytics to try to identify additional links and predictive data. No major findings were made with the small sample size available.

Farewell in Affordable Care UX.pptx

Farewell in Affordable Care UX Map Framework without images

Funeral Care Cost Inclusion in Health Insurance Survey Results.pptx

All answers received from the survey. Only question omitted is US state of residence as there no significant data worth showing.

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Photo of Shane Zhao
Team

Great updates Angel! In addition to the video, it'd be helpful if you might also upload your experience map as separate images. This way we can have printable versions of your user journey. Looking forward to hearing more learnings from your survey and prototypes!

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