pardon?
As my friends know, I have a hearing impairment, and relate pretty well to the world with the help of two Phonak hearing aids.
This post is the first of several about a boring topic – the price of hearing aids. It should concern you, because you have a fair chance of needing a set yourself, as you advance into a merry and sociable old age. Then you too will be told they cost more than a decent laptop each, and you really need two.
I guess most hearing aid users get them from private suppliers, who seem to be contracted in some way to one or perhaps two of the handful of companies that make almost all the world’s devices. As a rational customer, you will want to compare prices. At this point, you will discover that suppliers won’t tell you the price over the phone, and you can’t find the prices over the internet. That is, the only way you will find out what a particular model costs, is by submitting to an actual examination by a supplier.
This is not a way to empower the customer, or allow the magic hand of the marketplace to exert its beneficient presence. Some suppliers will claim they buy in bulk and reduce prices, but none of them can be buying aids from the broad range of models in large quantities, so that sounds like an excuse for a tied arrangement for me, more like a supplier’s discount.
Being a bit of a lefty, I was disconcerted by this cosiness when I first ventured into the area, and kept going until I found VicDeaf, a not-for-profit advocacy and supply organisation for the deaf. Their hearing aid bit is called Hear Service, and has a spiffy website. They provide a terrific service, keep prices down, and carry a range of aids, so that I can choose. I must say, they all seem pretty similar to me.
So, I bought my hearing aids, and they have held up fairly well in the corrosive environment of wax, and the physical shock of frequent removal to answer the phone. They cost me over $4000, which included the audiology, the programming sessions, the moulds and pipes, the free repairs, the return policy if I don’t like it.
But the big question is obvious: why are hearing aids so expensive?
The figures for people needing hearing aids are pretty sloppy. Four million Australians are said to be hearing impaired; one company reckons the figure for untreated people around the world is five hundred million. There are somewhere above eighteen manufacturers, of which perhaps ten do most of the business.
In other words, the companies are making an awful lot of hearing aids. Enough for mass production. Most companies have a huge range of models, to capture perceived market niche which often seems to be cosmetic. With many of the digital models having similar cases and functions (7 channels or 24, for instance) I wonder if they are the same product with functions disabled – a cunning ploy known in the camera trade, for instance.
Manufacturers would say they have huge research costs, like the drug companies. Unlike the drug companies, they don’t carry the titanic marketing and regulatory overheads that consume almost all the alleged “research costs” of most drugs. But they too are in a crowded market which is developing quickly, and a lot of design must be dedicated to circumventing patents.
Phonak, which makes my hearing aids, doesn’t discuss this on its website. But it did accidentally reveal a fascinating factoid. In a list of company milestones, it revealed when my aids first went on the market. 1987. The company has had 21 years to recover the cost of research, and they haven’t done much to develop them for many years.
They are a digitally controlled analog model, considered close to obsolete in 2001, as the tide of digital aids swept across the market. The digital control bit does imply significant work in the 1990’s, to develop the PC control system.
But since then, they are cruising. Same specs, as far as I can tell, seven years later. So the cost must have fallen, right? I think the answer is, a bit, but not much.
Today, I asked VicDeaf some preliminary questions about the market. They won’t talk about prices, will only point out that they are a not-for-profit and formally dedicated to a minimum markup. They carry a range of aids, so the customer can choose. They will not discuss the reasons for the price of hearing aids, saying only that “they are expensive to make”.
AudiologyOnline is a good technical resource, which includes a fair amount on pricing. As far as I can tell, the arguments rationalise teaching consumers not to compare on price, on the grounds that they will discount the secret service ju-ju provided by a good practitioner. I believe strongly in the ju-ju, but not in the logic.
It also admits that manufacturers will discount by up to 30% for a volume order, which is in the tens per month.
If anyone can add to this story, please do…
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Here is an odd fact, which I don’t understand. According to the Wisconsin Government Medicaid Program, the cost of my hearing aid is $US330, on a volume purchase contract. Does that represent the real price, or some subsidised rate paid by a low-income applicant? The site doesn’t provide enough information.
April 23rd, 2008 at 3:45 am
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April 23rd, 2008 at 6:35 am
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April 23rd, 2008 at 1:56 pm
Custom-fitted moulds for in-ear monitors that musicians use add about $300 onto the cost of using generic ones, I think.
When you talk about audiology, are these hearings aids aiming to boost particular bits of the frequency spectrum that you’re missing out on? Do they have, effectively, an eq built in? I thought they just basically took what they “heard” and made it louder.
I can imagine they’d need to be well-engineered bits of gear, but really, $2000 a pop is just insane. My guess is that at least half of that is nothing but the this-can-pass-as-medical-equipment-and-may-well-be-paid-by-insurers-anyway bonus.
April 23rd, 2008 at 7:54 pm
There is a lot of cute stuff going on in the frequency ranges. The function of hearing aids is not to boost volume per se, though they often have to. Instead, they amplify sets of frequencies which are absent from the total range. Most people’s hearing goes down at the top first, so they can hear words, but with the edges of the consonants clipped off.
Volume is okay, but intelligibility isn’t, which is why lipreading becomes so unconsciously important. Most older people, if they think about it, will realise that they hear better in bright light, and that is because they can see the shapes of people’s mouths, which provides visual data to locate which consonant is being used.
Hence, a system with more channels creates narrower bands, more precisely tuned to the actual deficit.
Just yesterday I was reading about a tricky problem created by the fact that processors can deal with high frequency rectification faster than low, which means the sound is being split in time. So the user tends to hear part of the word in the wrong order, or jumbled on top of the next syllable. Doesn’t matter if you hust have high frequency loss, but as you degenerate, you can’t just turn the volume up.
The game is all about intelligibility, and this is one of many factors which affects it.
April 23rd, 2008 at 8:41 pm
david – I’ll talk to you (if the batteries arent flat) when I get back next week – and do some backgrounding and research
fxh
April 23rd, 2008 at 8:43 pm
david – I’ll talk to you (if the batteries arent flat) when I get back next week – and do some backgrounding and research
fxh
The most interesting fact about hearing aids is most people who have them dont use them
April 28th, 2008 at 2:58 pm
Dear Barista
There is enough truth in your article to generate some very defensive heat from practising audiologists, and enough errors of fact to make their task easy.
A pity really.
But the biggest concern I have is that consumers seem to think that price comparisons are everything, and accept often sub-standard service – at any pricing point.
Neil
April 28th, 2008 at 9:57 pm
This is an evolving story and I’m happy to accept additional knowledge. I agree with Neil about the service issue. Particularly an issue when people reject their hearing aids because they are uncomfortable, or don’t seem to do the job, or tey don’t hang in long enough to adapt. All issues mediated by the experienced audiologist.
April 29th, 2008 at 7:26 pm
I wear two aids part of the day, take them off when I’m at home. I have worn aids for the past 15 or 20 years, cycled through several models, and find them annoying and noisy for most at-home relaxed use, although handy on walks. I need them for work, which involves face to face interviews — I do not think I do much lipreading, too much guesswork.
No longer attend movies, miss half the dialog with aids or inhouse amps. No TV (not because of hearing, because of ads and inanities), just DVDs (thanks BB & Netflix), but only if subtitled or CC’d. (Captioning is erratic, virtually nonexistent for many indie movies. Most downloadable videos are not captioned, rare on Youtube, Goodle has a small selection, Netflix tells me that only foreign movies are captioned in their free downloadable selections , it’s rare to get a DVD converted to avi that’s captioned, making P2P pointless, alas torrent pirates.)
The price goes up the more bells and whistles on the aid — I’ve tried the fancy ones –the one with tuners and remotes, and get no more oopmph than the basic amp models. I think for a lot of us, the finetuneing frequency business is a hype and a waste of time. Auditory placebo effect. (“I think it’s better.”) If you think aids are pricey check out the cost of an cochlear implant.
I’m aggravated by having to remove my right aid to use a phone, even with HAC/VC (hearing aid compatible/volume control) phones, aids telecoils etc. And also aggravated by idiot designs that allow the battery to drop out when the case is opened.
I have an experienced audiologist. There are many issues she cannot mediate.
May 8th, 2008 at 2:10 pm
Hearing aids are free on the NHS in Britain. There’s an idea.
July 22nd, 2008 at 5:19 am
[...] David Tiley offers insight into the pricing of hearing aids. [...]