I have a confession to make. Many years ago I was having a particularly bad day (perhaps someone took my green Phonak screwdriver) and a patient said to me, “I don’t understand why hearing aids cost so much. It can’t cost more than $100 to make them.” I think the first words out of my mouth were, “You are smarter than that.” It just went downhill from there. I regret it, but it happened, and I will just have to live with myself.
Times haven’t changed much, apparently, as I was just sent the link to an article in the LA Times about how hearing aids are such a rip-off. My thought was, “That is the most ignorant thing I have heard in a very long time.” At least I didn’t say it to anyone out loud this time. Since I suspect that much of the newspaper reading public in the Los Angeles metropolitan area is now busily either physically or digitally clipping this from their newspapers (a lot of our patients still do read the paper), a response is in order. To wit:
As my uncle was fond of saying to me… repeatedly… as he attempted to “teach” me how to play bridge, “How can you be so stupid!” The cost to purchase the chemicals contained in the human body is about $160. Is that the worth of a human life? As the worth of a human being far exceeds the cost of our component chemistry, so are hearing aids far more valuable than their component parts. This argument is a classic “straw man”.
I would rather not to go into the following analysis of the costs that go into the production and distribution of hearing aids, beyond silicon, metal and plastic. I much prefer to discuss the value of hearing aids – but more on that further on.
Let’s take a look at the dollars and “sense”. What all goes into the development, marketing, and delivery of hearing aids to our patients?
- Research and development – Developing and testing the sophisticated technology now available in hearing aids does not come cheap.
- Manufacturing facilities
- Corporate support – customer support, professional development, accounting, strategic planning, information technology, human relations, warehousing, insurance billing, quality control, call centers, and on and on.
- Thousands of brick and mortar centers for evaluation, fitting and maintenance of hearing aids.
- Staff – Required for all the above tasks and no less for the highly skilled professional staff to expertly evaluate hearing, select appropriate hearing instruments, and service those hearing aids for their lifetime.
- Equipment – Each office is outfitted with sophisticated audiometric equipment for testing hearing, fitting hearing instruments, and verifying hearing aids’ performance.
- Marketing – If our patients don’t know about hearing aids, they do no-one any good.
- Training – Professionals must be taught how to fit and maintain these complex instruments.
The number bandied about in the article as the cost of a pair of hearing aids is $6000. According Consumer Reports, the average cost of a pair of hearing aids in the US in 2020 was $2691. Since that is an average, many are paying significantly less. Yes, it would be nice if Medicare covered hearing aids, but considering the fact that Medicare reimbursements are falling across the board, it does not seem reasonable to expect that another big benefit is going to be added any time soon. It is true, however, that more and more third-party payers are making hearing aids a covered benefit, significantly reducing customers’ out-of-pocket expense.
Also mentioned in the article is a claimed 1100% mark-up on hearing aids. This is clearly misleading, considering the additional costs outlined above. And although most hearing aid companies are doing OK financially (even in as bad a year as we all had in 2020), I know of none that are posting anything close to 1100% profits.
The Value of Better Hearing
What upsets me the most about the article is how it under-values the value of better hearing. I can do no better than to quote Catherine Palmer, PhD of the University of Pittsburgh from her keynote address to the American Academy of Audiology in 2019:
We do not do hearing and balance tests.
We do not sell devices.
- Change the course of cognitive decline for patients
- Reduce the risk of patients falling
- Start a chain of events for a child that will promote reading, education, and employment
- Prevent social isolation
- In fact…we ensure social participation which increases life expectancy.
- We (also)…
- Decrease depression
- Decrease medical adverse events
- Decrease hospitalization and re-admissions
- And…we can save the health care system over 3.3 billion dollars per year.
All these claims are backed up by empirical evidence. And $3.3 billion savings to US health-care is pretty good for a $6.7 billion industry.
What I always go back to is the value of connection. Human beings are wired and designed for connection with other human beings. Connection is what our brains do best. Since hearing is the sense that is most intimately involved in communication and hence connection, what we do as a profession has very great value. “What is your hearing worth to you?” is not a trivial question. What is the value of hearing the voice of one’s grandchild or one’s spouse whispering “I love you”?
Hearing professionals and the instruments we place in our patients’ ears re-connect them with their lives. To me, this places hearing care among the great professions.