And there are good alternatives to the established brands now for cost-conscious, tech-savvy do-it-yourselfers: America Hears, which builds top-quality digital hearing aids and sells them online, programs them to your audiogram at the factory, sends you the software to make your own adjustments, and has licensed audiologists at the end of the phone to give you as much help as you need. All for under $1,000 a hearing aid. But most other comparable top-quality digital hearing aids still cost two to three times that much. Why? The answer is in the cost of the service required to get a custom fit. If you don’t dare do it yourself, a good audiologist truly is worth his or her weight in gold, especially if your hearing profile is complex. Getting a comfortable fit and programming assistance tuned to your audiogram usually requires multiple tries and is seemingly as much art as science. An audiologist who will stick with you through multiple adjustments is worth a significant mark-up. But it’s fair to question the value of the markup above and beyond the wholesale price of the basic hearing instrument components.
The hearing industry for the most part remains stuck in a very old distribution model which has restricted growth and shut off affordable options for a large segment of potential buyers in need of hearing assistance. Today most hearing aids are sold by audiologists who charge a single price for the hearing instrument and the service they provide. They give you a hearing test and fit you with hearing aids that meet your specific needs. Their invoice most often does not include line items for the cost of the hearing test, for the ear molds, for the hearing instrument, or for follow-up service. If it did, you would see there’s a lot of cost built into the time they put into helping you out. If you don’t need much help, they make a lot of money. If you are a difficult case requiring a lot of adjustments, they make less. This model worked well until recently. But now, digital technologies are making many more options available for people with different kinds of hearing loss. Open-fit designs mean many consumers don’t need an earmold fitting, and good digital amplification is making it possible for many people to get the hearing assistance they need from low-cost manufacturers selling direct, over the counter. One manufacturer, Songbird Hearing, is even offering disposable hearing aids that you can buy direct from their web site to address mild hearing loss, without a hearing test if you sign a medical waiver.
The big established manufacturers hate the idea of hearing aids being sold over the internet or over the counter. They would like to protect a business model that protects high margins for increasingly low-cost technologies by restricting availability to the audiology channel. That way they can maintain quality control and customer satisfaction by ensuring customers get the right product, the right programming and a good fit. They also need healthy gross profit margins to fund research on new technology, especially better software for digital sound processing. But unfortunately that business model also keeps prices high and hearing assistance out of reach for many consumers who simply can’t afford it. I’m a big believer in the value audiologists provide as part of the hearing industry supply chain. However, I think they will have to start publishing more detailed pricing for their services as well as for the products they provide. Competition from direct-to-the-consumer vendors will force them to. However, the competition won’t put them out of business, and won’t eliminate the premium end of the market. It’s okay to charge for valuable service, but customers should know what they are paying for.
And have no doubt customers will continue to spend for hearing assistance, especially when the industry makes it easier to buy exactly what you want at affordable prices. As the big established brands and new and established distribution channels offer a broader range of prices, products, services and solutions, the market will start expanding as fast as it should be, given the demographic increase in hearing loss. Everyone will win: the manufacturers, audiologists and other resellers will continue to make money, and, most important, more consumers will hear better.
Comments
6 responses to “Opinion: Hearing Aid Pricing Should be More Transparent”
I work in the electronic industry and the electronics in these 2-3 thousand dollar aids are probably worth about $100 to manufacture. All the rest is markup..
The real impediment to a free open market for hearing aids (and low prices) is the FDA’s classification of hearing aids as medical devices. As such they provide exemption from the ordinary laws of commerce and restraint of trade laws.. Hence restricted distribution and the attendent high prices. Ed
I’m looking for some reliable opinions, not driven by marketing objectives, on the range of really low-priced hearing aids, i.e., $100-500. How useful, for example, is Ampli-Ear, or Songbird, or others in that range. I simply can’t pay $2,000 but must get some help for moderate hearing loss. Can you steer me?
Steve
Personally I do not care if the audiologists make less money – there are complex cases out there that really need trained professional audiologists. For the huge number of us out here being raped by this industry there is no insurance, no real justification for the outrageous costs we are expected to pay and they have us over a barrel – we need them to meet the public. I have been being raped financially for hearing aids for 34 years and am beyond angry. There is multiple times more technology in my mac laptop computer than a top of the line hearing aid. Compare the cost. Just call me hosed and hating it. Right now I have through some kind of forgetful moment from hell have lost both of my three thousand dollar a piece hearing aids. I am hard of hearing enough that I have to have that level of technology to work safely in my occupation. I am at present without income. For the few hundred dollars these things would actually cost with a healthy markup I would be back in the workforce where I should be. As it is it took over half of my career to be able to afford decent hearing aids.
As an audiologist there are several reasons for the high price of hearing aids. R&D has to be recouped by manufacturers and the return rate of expensive hearing aids is factored into the the price of the hearing aids. I trained for 7 years to become an audiologist and the equipment required is expensive for testing and fitting,senior an accountant is charged at $300 per hour where I live, and Audiologists are charged at $125.00 per hour. And finally many audiologists double the price of their services for two aids!! think about it, does it take twice as much training, appointments etc for two aids compared to one. This is a issue that will need to be addressed in the future, I have addressed it in my clinic. There are real dangers in purchasing hearing aids online including damaged to ears/hearing as well as missing medical issues. I recently had some one who came in with a pair of internet purchased aids, he had saved thousands. Neither aid fitted his ears, they had been poorly maintained and one was not functioning. He commented that they didn’t work when he needed them…. they we appropriate aids for his loss, but he would have been better of with a cheaper properly fitted pair, I fixed his problems for a small fee and he commented that he wouldn’t be buying his next pair from me regardless of the fact that he could hear much better!! hmm?
I’m also an audiologist who is very familiar with the complaint of hearing aids costing too much money. I have a difficult time finding where to place the blame though. The technology advances quickly and the market is small. That’s a bad combination.
The manufacturers are racking up R&D costs by constantly trying to out-do each other. They’re using proprietary and industry-unique components to build “a better hearing aid.” If a manufacturer backs off of R&D, they die. A clinician isn’t going to dispense an inferior product when a significantly better product is available from a different manufacturer.
Although it’s true that hearing aids are often marked up significantly by clinicians, look around – audiologists aren’t getting rich. There’s a lot of time, education, and equipment costs that go into a stellar hearing aid fitting. A good audiologist should be performing valuable services to maximize the effectiveness of the hearing aids. Technologies like real-ear verification, speech-mapping, speech-in-noise testing, real-world simulation, etc. can make a huge difference in the performance of a hearing aid. The value of these services often justifies the cost of the hearing aids, but a lot of clinicians do little more than slap on the hearing aids and say “how does it sound?” Do they charge less for the hearing aids because they are bundling fewer services into the cost? (Unfortunately, the answer is no.)