FEMA Continues to Fund COVID-19 Funerals and Pandemic Expenses
The Federal Emergency Management Agency (FEMA) is still disbursing billions of dollars for pandemic-related costs, including up to $9,000 for each funeral related to COVID-19. This is happening despite criticism of the agency's responses to Hurricanes Helene and Milton and claims that the Disaster Recovery Fund is unable to manage a third major storm.
COVID-19 Reimbursements Continue Despite Criticism
The government's response to the COVID-19 pandemic has been widely criticized for its detrimental effects on both individual health and the nation's fiscal stability. The federal government has been accused of recklessly distributing trillions of dollars to people, businesses, and state and local governments to counteract the impacts of its own policies. Despite the controversy, FEMA continues to pay up to $9,000 each in funeral expenses for those who have died from COVID-19.
Government Favoritism in Funeral Reimbursements
The policy of reimbursing funeral expenses for COVID-19 deaths has been criticized as an example of the government favoring certain causes of death over others. Critics question why the family of a person who dies from COVID-19 is more deserving of a government-paid funeral than the family of someone who dies from other causes, such as cancer, cardiac arrest, or a car accident. This question was relevant in 2020 and remains so today.
Exclusion of Pre-Paid Funerals from Reimbursement
The funeral reimbursement program does not cover those who have planned ahead by pre-paying for funerals. Some families feel they are being penalized for planning for the future, similar to those who saved for college only to see their neighbor's student loans forgiven.
Significant Increase in Funeral Assistance Applications
FEMA's funeral assistance program has seen a significant increase in applications during the pandemic. In the decade before the pandemic, FEMA received about 6,000 applications for funeral assistance for various natural disasters. As of January 1, 2024, FEMA had approved more than 300,000 applications for COVID-19, disbursing $3.15 billion.
Government Subsidy Leads to Higher Costs
The presence of a government subsidy often leads to higher costs. Knowing they can spend up to $9,000 of other people's money on a COVID-19 funeral, many families may have chosen more expensive options, thereby increasing the profits of funeral homes, casket producers, and other related businesses.
Qualification for Funeral Assistance Program
To qualify for the funeral assistance program, the death certificate must indicate the death was caused by COVID-19 or that it may have been caused by COVID-19 or "COVID-19-like symptoms". There is no requirement for US citizenship for either the deceased or the person paying the funeral expenses, and there are no income or wealth criteria.
Additional Costs of the Program
The program also incurs significant overhead costs. FEMA chose to have all claims submitted via 20-minute phone conversations, requiring the creation of a large call center operation staffed by 5,000 phone agents. Money was also spent on advertising to promote the program.
Improper Payments and Fraud
Government handout programs often result in "improper payments", which include both fraud and errors made by applicants and administrators. FEMA's funeral-funding program has been criticized by government watchdogs for gaps in internal controls meant to prevent improper or fraudulent payments.
Continued COVID-19 Outlays
The funeral reimbursement program is just a small part of ongoing COVID-related government outlays. In the fiscal year that ended September 30, FEMA recorded $15 billion in COVID-19 commitments, accounting for 39% of all FEMA disaster relief obligations.
Depletion of the Disaster Relief Fund
FEMA's Disaster Relief Fund is repeatedly running out of funds, prompting additional multi-billion-dollar infusions from Congress. Homeland Security Secretary Alejandro Mayorkas has stated that "FEMA does not have the funds to make it through [hurricane] season."
Future of the Program
Unless extended, FEMA will stop accepting COVID-funeral reimbursement applications on September 30, 2025. However, the agency plans to tap its disaster fund for other COVID-19 outlays for four more years, amounting to another $22.2 billion between now and September 2028.
Bottom Line
The continued funding of COVID-19 funeral expenses and other pandemic-related costs by FEMA raises questions about the sustainability of such programs and their impact on the nation's fiscal health. It also highlights the issue of government favoritism in the allocation of funds. What are your thoughts on this matter? Do you think such programs are necessary or should they be reconsidered? Share this article with your friends and sign up for the Daily Briefing, which is everyday at 6pm.
