Laura Wadsten, Correspondent at The Capitol Forum, recently published an in-depth article on the timeline and potential market impact of new OTC hearing aid regulations. I received permission to share the article with readers. The Capitol Forum is an “analysis service dedicated to informing policymakers, investors, and industry stakeholders on how policy affects market competition.”
What I’m understanding the import of this to be is that if you are thinking of replacing your current hearing aids, hold off because prices will becoming down in the near future. Unless, of course, you are buying from Costco or are heavily covered by your insurance provider.
I have been able to save thousands by buying through Hearing Revolution, a subsidiary of Hearing Care Solutions. But I suspect that even these prices might be considered high in the not too distant future.
There are three marketing components at play: Supply, demand, and options. Supply will increase with more players. Demand may increase slightly because cheaper options will expand the market, but there are only so many that require hearing assistance. More options and lower prices will definitely impact the medical grade hearing aid manufacturers and fitters.
If I were an audiologist, I would be adjusting my marketing strategy to advertise “bring in your OTC hearing device, let us test how it’s performing for you and let us optimize it for you - for a small fee.” Not just to sell their own high priced items, but as a legitimate service.
If I were a Widex, Opticon, Phonak, etc. I would be expanding my R&D and marketing into over-the-counter, user adjustable products.
If I were Sony, Bose, Samsung, Apple, or other top drawer consumer ear bud manufacturer, I would also be expanding my R&D and marketing to take advantage of these new regulations.
Consumer Reports really needs to play catch up. Their latest reviews of these products are three years out of date, and even then their reviews were superficial and mostly useless.
There will always be the need for “real hearing aids” because so many of us have hearing issues that the OTC will not be able to take care of. If I had to depend on OTC aids for my speech understanding requirements I would be SOL.
That assumes that OTC do not address those types of hearing issues. It’s a matter of time before they do. The need for specialized care to treat unique conditions will continue, but that market will get smaller and smaller.
Then what happens as the ones using the OTC aids start losing more of their hearing, and yes the will continue to lose some of their hearing. And what I am scared of is how many will end up making their own hearing worse by trying to do what they shouldn’t do in my book.
The issue is price. More competition in the marketplace will bring down cost even for the hearing aids we love that are not sold over the counter.
that I truly hope for but I am afraid it will mean that they stop doing the wonderful R&D that has given me my hearing back by way of the Oticon More1 hearing aids.
My biggest fear is consumers buying OTC when they are past “mild to moderate” then being disappointed when they don’t work and giving up on hearing aids. They will say to friends and family: “See I told you they would not work for me” and then go for years making themselves and family suffer with their hearing loss.
I believe demand will increase sharply. Most insurance companies do not provide significant coverage of hearing aids. Medicare has no coverage. MANY senior citizens have poor hearing and just languish with it because the current provider/supply system is way beyond the means of a large portion of the senior citizens on fixed incomes.
Hopefully the OTC hearing aids will help fill that tremendous gap. Once seniors discover how much augmentation can help, they may find a way to move up to more capable HAs as their needs require.
However, any help is better than not being able to communicate.
That even happens way too often now, due to not being educated by the Audiologist to what the patient needs to know and do. I had a talk with my VA Audiologist about the lack of proper education of patients getting hearing aids. A new patient can’t be run in and out of the office in the amount of time most are and be expected to understand what they need to know about their hearing aids. Few are even told they will need repeat appointments to get their aids fit correctly. They aren’t told they need yearly hearing test, or how to maintain their aids. I feel this is why so many people just throw their aids in a drawer and forget about them.
CVKemp, I also want them to continue with the R&D. What’s hard to understand is why they have to charge so much for what is essentially a dedicated computer when far more powerful lap top and iPad computers are available for a fraction of the $6-7000 they’re charging retail for hearing aids. I realize that part of that cost is to cover insuring it and the Audi’s time, but even if you deduct that, the mark up is still outrageous.
There is a rare breed of Audi’s out there who are separating the cost of the aids from the Audi’s appointments, but they are few and far between. That’s the way it should be. There’s too big an incentive for Audi’s to become like car sales people instead of health care professionals.
I have the Oticon More1 hearing aids now, and I will say this after about 16 years of wearing aids, the More aids have finally proven that the engineers and developers are finally starting to understand what it takes to create aids to really help people to hear close to the same way that someone with normal hearing hears. That takes tIme, time is money, just like computers, hearing aid hardware is useless with out the programs to make them work. The development of that controlling software is what is so expensive and takes so long to make happen.
Yes the hardware is cheap, good software to really make that hardware work with our brains is what is expensive. And without that software that hardware is useless.
Since I most likely have the More 1 in my future after I retire my Opn 1, I appreciate your perspective, CVKemp. Thanks.
I would still like them to decouple the Audi’s services from the cost of a new HA. I’m more than happy to pay for the Audi’s time, which I value, as I use it. But I really have no interest in paying for appointments that I never use. Since it’s all bundled, that’s what we’re all doing under the current system. And worst of all, for those “unlimited follow up appointments” for 3 years, we’re locked into the Audi who sold us the HA whether we’re happy with those services or not. We only have portability if we’re willing to pay a new Audi out of pocket after having paid thousands up front on top of the cost of the hardware to the one who did the original fitting. It’s simply a terrible system.
I must confess something here I am a Veteran with a hearing disability. My aids are from the Veterans Administration and my Audiologist is the most wonderful person I have ever known . It took one year’s worth of monthly appointments to get my OPN1 aids adjusted to a point that they were even close to useable for my hearing needs. A long the way my Audiologist came to the conclusion that my ITE OPN1 aids were not powerful enough for my real needs. So I was given the OPNS1 rechargeable aids with the 105db receivers, my OPN1 aids had 85db receivers. The OPNS1 aids have custom ear molds and the improvement was dramatic. And I was doing good with them, but I have always had issues with my left ear, the ear molds just will not stay in place, and my t-coils had static to the point that the t-coils weren’t useable. This spring I had requested that my OPNS1 aids be repaired but my Audiologist told me to wait until after the first of May, I said okay. I go in on mid May and my Audiologist says I am getting you the More aids, I was confused because I hadn’t had the OPNS1 aids for a year yet. He said that I needed a good set of backup aids and the OPNS1 will be a good backup, and the More1 aids should get me to the point of understanding speech the way I desire and need for my volunteer work. Well the More1 aids are every bit as good as Oticon claims at least for my needs.
So as best we already know, major HA manufacturers are already preparing. Sonova buying Sennheiser already naked that clear. The cobranding with Jabra. Samsung and Apple biting at the bit. It’s happening and the pressure on the FDA will only build to get this finally done as deep pocketed companies increase the call to move this forward. They certain have marketing and lobbying experts already on salary and they can be effective once a company commits to that course of new product development.
Those same deep pockets aren’t going to be deterred because they need to lay out money for some more regulatory work should a 510k become a requirement for approval. It’s already stated that process may take several months, but the big consumer electronics companies can certainly foot the bill, and build it into their rollout timeline.
In truth, the “big 6” aren’t all that big when Sony, Samsung, and Apple are knocking on the door. At least they know based on the cost of their goods they can slash prices and still maintain a profit (they don’t sell in bulk to Costco or the VA or the NHS at a loss).
As to market size, in the US alone the need is estimated at 34 million people in need of hearing assistance with at best a third able to afford it. That still leaves 20 some odd million locked out of the current market. That’s a pretty big market. Add in the rest of the world and you can capture 10% market share and still be selling tens of millions of aids, which is a nice number, even for the big boys.
There is one new proposal for Medicare that may complicate the picture. There is now an effort to add dental, vision, and hearing care to Medicare Part B. If that happens, and the benefits are sufficient to cover an audiologist and at least basic aids, the OTC aids may find a tightened market, especially if OTC aids were not included. Now the smart, affordable approach by Medicare to cover cheaper OTC aids first and Rx only if the OTC did not meet the needs of the person, but given how little Medicare strikes bargains on things like Rx drugs (yes, part of Part D for prescription coverage specifically bans them from negotiating lower prices, great decision making there), so who knows how that will work, let alone survive getting through Congress.
Thank you for sharing this it is very interesting.
The problem is not the audiologists: it’s the manufacturers who have monopoly pricing. They will either adapt or fade away. It’s easy to analyze the published financials for the big mfg’s and see the fat. That being said, they have been advancing the technology in our east’s and in the audiologist’s office.
Cannot TELL you how many folks I know who end up with aids “in the drawer!”