A Hearing Loss & Late Deafened Blog

Why Hearing Aids Cost So Much

In Assistive Listening Devices, Audiologists, Deafness, Hearing aids, Hearing Loss on June 1, 2011 at 3:03 am

I recently read a book called Predictably Irrational by Dan Ariely.  For the first time ever I understood why we are willing to pay $6000.00 for digital hearing aids, while we wouldn’t dream of paying more than $200.00 for an iPod that can do so much more and uses basically very similar technology.  There is no reason hearing aids should be priced so high.  They are made of nothing but small bits of plastic and wire.  The digital technology and microchip that was  state-of-the art in the 1990s is not new today, and yet the prices on hearing aids have still not come down.

In fact, nothing amazing has happened to hearing aids in over a decade unless you count blue tooth, and that’s not really new technology.  It’s new on hearing aids, yeah, but it’s so not new.  It was only a matter of time before someone stuck bluetooth technology in a hearing aid– a no-brainer really.   You had small phones the size of a hearing aid.  Why not actually stick the technology IN a hearing aid?  It wasn’t developed for us.

Many things on hearing aids have become automatic, but not better.  For example, most of us who have worn our hearing aids for years  prefer controlling when our FM kicks in.  If you have ever been to a convention with a room full of hard of hearing and deaf people, you don’t want your FM kicking in every time someone walks by with a Smartlink.  Soooo annoying.  I also prefer to have control over when my “speech in noise” program kicks in.  I don’t like my aid muffling sounds for me.  Sorry.

I am getting off the subject– my point being that there is not much new going on in hearing aids since the 1990s, so they should have come down in price by now, but they haven’t.

There is one area I forgot to mention here and that is the open fit aids.  They ARE new and literally cool because you don’t have to wear ear molds.  But if you have a severe hearing loss you can’t wear them, though many audiologists will try to sell you a pair, knowing you’ll be back in a couple years needing more power.  Even though open fit aids are not power aids and often do not have FM, they cost about the same as a power aid with more on it.  So basically you’re paying MORE for LESS!

Back in the 1990s, when digital hearing aids were the new thing, hearing aid companies believed we would pay nearly twice what we would pay for analogs, so they upped the market price to  $6,000.00 for a pair of state-of-the-art power aids.  If you balked you were given some rhetoric about how hearing aid wearers were a niche group and that the technology was developed specifically for us, and that we had to pay for it somehow, and how much was your hearing worth to you anyhow?  Isn’t your life worth it?   Now, over a decade later we are STILL paying that same price.

But hearing aids haven’t improved much.  We have been trained to expect to pay $6000.00 for a pair of state-of-the-art digital hearing aids.   And pay we will.  Because we have no choice if we want to hear.  Or do we?

Do we really need automatic everything?  Do we need bluetooth?  What would happen if we all shopped around a bit?  And demanded less?  What I mean by that is what if we were to start demanding no frills aids, no automatic anything with lots of power and FM for a good price?

Just say no.  They won’t get the message if we keep spending.

 

 

 

  1. I agree fully. I was recently quoted $6400 for a pair of digital hearing instruments. (Have been wearing digital since the early 90′s). Anyway, I was not prepared to pay that amount and started shopping around – which in itself is problematic here in South Africa.

    I eventually stumbled upon the website of an audiologist who was prepared to do it for $1900. What a dramatic difference! They are very small, extremely powerful, a well-known brand name but with minimum automatic features (there are however, fancy models available if you can afford it). I too, prefer changing settings myself as (for me) the fancy auto features simply leave me hearing even less plus, I do not feel comfortable with blue tooth and other waves passing through my brain all the time!

    When chatting to a colleague the other day, she casually mentioned that her grandfather was charged $12,000 for his pair! I nearly fell on my back. I think hearing instrument customers are in a captive market and are perhaps often over charged.

    • 12,000 is an unbelievable price! It’s a crime, especially when you realize that many people buying hearing aids are retired on fixed incomes!

      • dear leon,

        what is the brand of your hearing aide? for $1900?

      • Hi Tracy,

        I bought “Unitron Shine +power” hearing instruments. They are completely in the canal but still very very powerfull. I don’t know if the brand is available where you stay?
        Also, if I now convert what I paid to US dollars, it works out to about $1500 for the two.
        Hope this helps.

      • thanks very much leon,

        i live here in china and happen to be going to siemens tomorrow…hope my current aides can be fixed…my insurance that covers 100% everything else does not cover hearing aides for people over age 24…

  2. And yet, HLAA and other organizations are rallying Congress to pass our getting $500 tax deduction for buying hearing aids. I found it not only to be a bad joke, but an insult to all hearing impaired people.
    Great article Kim.

    • Amen Pearl! $500! Big whooping deal! That’s just a drop in the bucket!

      Of course we’re overcharged for hearing aids. They can charge whatever they want because they have no oversight. No (well, almost no) insurance companies pay for hearing aids so they aren’t forced to keep their prices at a level where the insurance will pay it.

      While many have no choice but to get new aids – I agree with Kim – no frills hearing aids really are the way to go! Also, if you can hang onto the hearing aids you have, do so. Heck, I’ve been known to wear mine for 15 years. I take care of them…I can’t afford not to!

      I will say this – any audiologist that will sell you a pair of aids that are not powerful enough for you and are otherwise unsuitable for your level of loss, then find someone else! I’ve been very fortunate to have a great audiologist center who do not try to oversell to me. They know better. I have also told people who are looking for a hearing aid, to not get the automatic everything. The more bells and whistles you get, the more bells and whistles that’ll break down eventually! Gah!

      • The longest I’ve been able to keep a pair of hearing aids was for ten years. With a progressive hearing loss, I’ve had to get new hearing aids regularly. I have learned to buy aids I can “grow into” with a little more power than I need right then. Good advice Jo Ann

      • When I got my most recent pair, I told her I wanted a LOT of “wiggle room” to grow in power as needed. I’ve always done this.

        As for how long I’ve been able to keep my aids, it always surprises people that I’m able to do this. It’s pretty simple to me – I never ever allow them to get damp – I do not keep them in the bathroom when I shower. If it’s raining, I either use an umbrella or wear a hat and each and every night they go into the dehumidifier. Worked for me. ::knock on wood::

    • It’s a start, but so inadequate. At the very least I think the amount should be more for people on lower incomes.

  3. Interesting discussion on this thread! I think that currently there is a price bubble taking place… you can read more about it here: http://audicus.wordpress.com/2011/05/26/hearing-aid-price-bubble/

    Quality hearing aids nowadays are comprised mostly of digital signal processors that in its aggregate don’t cost more than $20-$100. Most major manufacturers (e.g. Phonak) mass-produce these devices in low-cost China. Nevertheless, the patient foots a bill of $3000-$7000 for a pair… with prices nearly doubling in the last decade!
    Just to re-enforce what was said in this post, I think there are two key elements to the exorbitant price levels:

    1. Bundling: audiologists do not provide transparency on the final bill, but instead often bundle the service, device cost, equipment use, warranty, repairs, etc. into one number. Some people, such as experienced users looking for their next hearing aid, might only require a fraction of these services… however are billed for the full package.

    2. Over-engineering: for the majority of users, devices nowadays do not provide substantial improvements in alleviating hearing loss, compared to devices from 2-3 years ago. Instead, manufacturers pack these devices with myriads of features that allow them to pass on price increases. Think wireless functions, Bluetooth, remote controls, 20+ channels,… whereas according to Audiology Online, patients don’t perceive a notable benefit beyond 5 channels!

    Quite frankly though, someone who can’t buy a hearing aid because it’s grotesquely priced doesn’t care about having a bluetooth-enabled device; he/she just wants to hear better. It seems that when it comes to hearing aids, patients are often only offered the “Rolls Royce”… but don’t have the choice of opting for the “Honda”.

    This market is due a shake up, where ultimately more choice and transparency needs to be given to patients.

  4. Contrary to popular belief, companies don’t just pick arbitrary prices for their products. The price tag is determined by the company’s target profit margin and their cost to manufacture the product, market it, and sell it.

    You mentioned the iPod costs around $200. According to Apple’s website, they’ve sold around 275 million iPods from 2001 to 2010 (averaging 30 million per year). How many hearing aids were sold in that same 9 year period? I’ll bet it’s significantly less than that.

    My hearing aids are two years old; the pair before that were seven years old. How many people do you know who are still using an iPod from 2004? I don’t know any. And do you know why? Because iPods continue to change. People replace their iPods with newer models because they want the newer features. Apple knows this and they adjust the price so people can afford to do that.

    I’m certain iPods cost more than $200 to produce. Apple very likely has bulk buying discounts on raw materials and cheap foreign labour. So their business model very heavily depends on a large sales volume. And as you can see by the number of iPod sales, it works well for Apple.

    But the hearing aid market is different. The technology is just as expensive and there are far fewer potential customers. Unlike with iPods, nobody goes out and buys hearing aids for funnsies. And (as you pointed out) the technology hasn’t changed in ten years. So manufacturers can’t count on making up production costs with sales volume. *That’s* why prices are (and continue to be) so high.

    And I’m sorry to say, but your advice to “just say no” will only compound the problem. If you really want prices to go down then you should replace your hearing aids every year with the latest model. If enough people did that, there’d be more product innovation and prices would drop to encourage more volume. But since nobody would be willing to take such a hit for the team, prices will remain high until the next significant technological improvement.

    • I agree with you that the global sales volume for hearing aids is far lower and thus higher prices are required to compensate for R&D, production, distribution, etc.

      However hearing aid prices nowadays are high, not because the technology is complex, but rather because there is a substantial service and maintenance component provided by the audiologist (testing, fitting, advising, etc.).

      By analogy, if audiologist clinics had more sales volume, maybe they’d be able to reduce the overall price of their hearing aids in order to stay in business (i.e. better utilize their infrastructure)… or maybe there are just way too many clinics for the existing hearing aid demand?

    • I’m sorry, but I disagree. Here’s something to consider.

      One in three people over sixty-five is hard of hearing. If hearing aids were more affordable, more people over sixty-five would be wearing them. Unfortunately most people begin to lose their hearing when they are on a limited income.

      Hearing aid manufacturers would sell more hearing aids if they lowered their prices. This is why Costco’s audiology dept. is booming.

      • Assuming you’re right about that. Let’s say a pair of hearing aids that costs $6,000 were to be lowered to $3,000. A 50% price cut is pretty good, right? Except sales volume would need to increase by 200% just to *break even*. I like to work with numbers instead of throwing around generalities…

        In 2000, there were 35 million people age 65 or older in the US. So by your statistic that’s about 11.5 million hard of hearing people. Unfortunately I can’t find concrete numbers on ages and incomes when people begin to lose their hearing, but we can safely assume that some of those 11.5 million people already wear hearing aids.

        So let’s just make up a number… say half… 6 million people needed hearing aids in 2000 and couldn’t afford them. Now personally I think that’s *very* generous but we’ll go with it. And we’ll even assume that ALL of those 6 million people will pay the top price even though that’s completely laughable. So 6,000,000 people each paying $6,000 is $36,000,000,000 (billion). Now remember this isn’t profit but total out-of-pocket cost for the customer.

        If the price were cut in half then it’s only $18 billion, so they’d need to sell twice as many to be equally profitable. But wait! In our extremely generous example, there aren’t 6 million more people who need hearing aids! This is why you can’t lower prices and make it up in volume on a limited market. Remember, Apple sells an average of 30 million iPods *per year*, but most people only buy hearing aids every few years. iPods and hearing aids are orders of magnitude apart.

        And in fact, I’d wager those numbers are so grossly disproportionate to reality that even lowering prices by 15% or 20% would be bad for business. So why is Costco’s hearing aid business booming? Because they offer lesser quality products at lower cost (just like Walmart). If other HA vendors lowered prices to Costco’s level, Costco would lower theirs in turn. Costco (and Walmart) attract consumers who care more about lower up-front costs than recurring costs (quality). Lowering prices will not change this attitude.

        I recently read a study that refuted the “if hearing aids were cheaper, then more people would buy” claim. Check it out: http://hearingsparks.blogspot.com/2011/05/how-insurance-and-cheaper-hearing-aids.html

      • Again, this is a matter of opinion and just one study comparing people who have insurance coverage for hearing aids against people who don’t. Costco carries Bernafon, which is made by the same company that makes Oticon–an expensive aid I’ve never had good luck with. They also carry Rexton aids which are made by Siemens. The best hearing aid I ever owned was a Siemens. I have also gotten some great wear out of a pair of Rextons in the past. GN Resound, another brand they carry is OK. I’ve had a pair of those in the past too. Their Kirkland signature brand is made by Siemens.

        The best thing about Costco is they give you a 90 day trial period and if the aid is upgraded within a year of your purchase you can turn it in and they will replace it with the new model. The 90-day trial period is more than ample time to determine if you’re getting enough benefit from the aids.

        The downside is Costco mostly caters to people in the mild to just barely severe range. If they had an aid powerful enough for my hearing loss I would not hesitate to try them. I buy my glasses there.

        My current aids are Phonak Naidas. Instead of paying $6000.00, I paid $4500.00 for the previous year’s model, since Phonak had just come out with a new model. I did get the bluetooth later, and I have mixed feelings about it. I don’t see a big advantage over using FM. It made me wonder if the Naidas could have cost less if they came without the bluetooth capability. Sadly I didn’t get that option so I have both the FM and the bluethooth and I use the FM far more often.

        All of the automatic programs have been turned off.

        Really I think we’ll have to agree to disagree on this. The best way to drive prices down is to support businesses and manufacturers that offer lower prices.

  5. With regard to various hearing aid brands, one point I want to stress is that everyone is different. For example I happen to dislike the sound of Oticon hearing aids, but I know many people who love them. It’s just a hearing preference. It is the same as disliking the taste of grapefruit, or the smell of musk oil. Who knows why? It’s hard to say.

  6. I agree that consumer resistance is the best way to fight high prices. I got tired of paying $2,500 per aid every five years for the newest and best hearing aid technology, so I resolved several years to buy the cheapest aids I could get. My last two purchases cost an average of $1,500 each, of which $1,000 was paid by insurance. I probably overpaid for what I got but these basic, digital power aids still gave me better sound quality than the older top-of-the-line aids I replaced. Consumers need to be aware of the market and to shop around for the best prices.

    • I agree as well. My previous set had noise cancelling an this that and another but I always switched off that feature since I found the result to be ‘muffled’ sound. I now have the cheapest digital model and it works just great with crystal clear sound and amazing amplification. Plus they can be adjusted in future if my hearing deteriorates further.

      Also I would not compare purchasing hearing instruments to purchasing an iPod since the iPod is a voluntary spend whereas the hearing instruments are not.

      • Leon- Good point about the iPod being a voluntary expense. Since the iPod was marketed to teenagers, and ordinary mp3′s run around $20.00, Apple never would have been able to sell them if they had priced them at $6000.00. People will spend more on hearing aids because they are a necessity. Even so, when Apple first came out with the iPod many middle-class parents balked at the expense because they were used to the cost of the $20.00 Sony Walkman– a completely different product that played music. MP3′s were a little more expensive at that time, running around $30-40. The iPod came sychronized with iTunes and that’s what set it apart from other mp3′s, which justified the extra expense somewhat. But if you think it through, it’s probably not really worth the $200.00. The price of the iPod should have come down by now.

        In many ways it’s a similar story to the inflated cost of hearing aids, except that hearing manufacturers know we will pay much, much more because we need to hear.

    • Sometimes people have a hard time finding an audiologist who is open to cost consideration Lorne. Did you have to shop around for audiologists too, or was yours helpful in trying to find the best aids that fit your price range?

      • There also has to be more transparency on what goes into the final bill. We recently ran a survey among 200 hearing aid users and less than 2% knew what the price was made up of. Ideally, audiologists should allow users (at least experienced/educated patients) to pick and choose what part of the service package they want (warranty, after-sale adjustments, etc.) and bill for that separately. Patients need more choice when facing such an exorbitant price tag.

      • Mine is helpful in trying to find the best power aid in my price range but his clinic uses a fixed price list and doesn’t like to deviate from that list. I probably could have found similar aids for less money if I didn’t have a long-term relationship with this clinic.

  7. Audicus I agree. I can’t say I know how much I’m paying for services, but I would be glad to change the tubes myself if it would save money. It’s not hard to do.

  8. I have one cochlear implant on my right side and the old fashioned hearing aid on my left side
    Because I may be going deaf soon in my left ear I didn’t want to buy a digital hearing aid at three grand so I went on line to look to buy one similar to mine…I found a web site called ear mall which sells the neural hearing aids
    I have a Siemens bte completely refurbished for four hundred dollars guaranteed for a year…
    If my hearing goes south in my left ear I can now go bilateral.
    I do not intend on mortgaging the farm buying a fancy digital hearing aid anytime soon
    I wish soon they would lower the price of some of those Aids…Its a shame meeting up with so many people who just can’t afford to buy them and are still deaf because they can’t afford it…
    HMO’s are reluctant to add hearing aids to things they will cover
    The IRS thinks a Hearing aid is a luxury…Go Figure

  9. to kim
    Kim the ipod also is internet related Wified and ready to do many other things
    Its not just for music
    Videos and many other features totally different
    The App store is filled with many different types of things one could buy for their ipods
    Hardly anything sony has ever done

  10. Here’s a more recent post on hearing aids and the over-engineering that manufacturers do:
    http://wp.me/p1yDhL-27

  11. This is the nice information, And I agree that consumer resistance is the best way to fight high prices. Many things on hearing aids have become automatic, but not better. For example, most of us who have worn our hearing aids for years prefer controlling when our FM kicks in. If you have ever been to a convention with a room full of hard of hearing and deaf people, you don’t want your FM kicking in every time someone walks by with a Smartlink. So annoying. I also prefer to have control over when my “speech in noise” program kicks in. Thanks for nice information.
    hearing clinics

  12. [...] Why Hearing Aids Cost So Much blog post on the SayWhatClub blog pretty much has nailed the question and issue right there. Then [...]

  13. Here’s another sobering infographic, comparing the price of a pair of hearing aids with a basket of items on ebay:

    “What else can I buy for the price of hearing aids? How about a Harley Davidson!”
    http://wp.me/p1yDhL-2S

  14. There are some hearing aids that you can set up and adjust yourself, using a programmer interface. These “do it yourself” hearing aids have been specifically designed for people who want to customise the features of the hearing aids themselves – like how automatic, or how to indicate when the batteries are going flat, as well as the more usual features. I’m involved with one of those companies, Australia Hears – we don’t use compression technology, and we have been working really hard to reduce the cost, without affecting the quality of the hearing aid. Of course we work on line (our US partner is America Hears of course).

  15. Although very small, hearing aids are very expensive to make. Think about everything that goes into making them work, a little electronic device that actual improves human hearing. Hearing aids are still very new in technology, technically. For more information on hearing aid or hearing loss checks out this website Advice on Hearing Aids. Really great site, loads of great info.

    • Expensive to make……. give me a break! Go on EBay and search for Siemens hearing aids and you will find the Siemens Touching for $89 INCLUDING shipping from China! Go to an audiologist and he will happily charge you $1600 for the exact same unit that HE got from China!

      • i am so enjoying this blog…thanks for all the good info…my hearing aides are broken and i am going just so happens to siemens here in beijing china to see if mine can be fixed…last set of hearing aides cost $4000 five years ago…my son recently…a few weeks ago…his cost $7000 and $1000 was covered by his insurance…just found out my insurance only covers people under age 24…what a bunch of poppycock…so if i have to buy new it will be out of pocket totally…hoping to find reasonable priced hearing aides tomorrow in beijing…cheers and ooo la la from beijing~

      • Completely agree with you Tom!
        An iPad is a million times more complex than a hearing aid and still costs 6x less.
        There’s been a pretty interesting post that compares these two devices and why hearing aid costs are greatly driven by retail and other intermediary costs.
        You can read it here: http://bit.ly/R4x30u

  16. After dispensing hearing aids for three decades the misinformation spread by people that assume things has reached a new level with the internet. Hearing aids have advanced incredibly in just the past three years. In using customer satisfaction, the figure has doubled. As the market is extremely competitive, the cost of advertising is very high. The average hearing aid specialist makes 30,000.00/year, while selling 250,000.00 worth of hearing aids.

    The expectations people have are unrealistic. A discrimination test must be done with amplification. If a person has worn hearing aids with an outdated setting they will almost certainly increase permanent distortion and the prognosis gets worse.

    On a sidenote, I saw a reference to Siemens Touching product. The box has Chinese writing on it and is a fake. Call Siemens and ask if they support that product. It is similar to the bionic ear, and is truly a ripoff.

    At my office I offer entry level, 90 day service for a few hundred dollars to high end wide bandwidth hearing aids that have infinite settings. It takes a pro to adjust these, and results vary by the person fitting them.

    I have seen many people jump into this market thinking they can sell cheap hearing aids and go broke within a couple of months to a couple of years.

    We work hard, we are licensed, trained every year by law, refer up to 10% of new customers to ENT’s after doing a test and finding an air-bone gap, wax, infections, sudden hearing losses, or unusual conditions in the outer ear.

    Pricing is considered inelastic so competition drives price. Objective verification using calibrated equipment in the office to measure speech understanding, during adaption and after are critical. How much an individual can hear speech in measurable noise, (speech to noise ratio), is a prognostic tool and must be used on everyone.

    I have found ways to extend a hearing aid beyond recommended fitting ranges in many cases. You just can’t do it with everyone though.

    A good specialist will offer a wide range, but be honest and ethical when describing the expectations after a thorough audiometric evaluation.

    improving hearing is science and art. I know some that just can’t articulate properly. If you are not comfrotable with your specialist, go elsewhere. Never buy a non FDA approved hearing aid, or mail order. You will need adjustments to be done by a professional. It takes me two years to train a person to fit hearing aids the right way.

    Terms to look up include, recruitment, permanent distortion, dynamic range (of the impaired ear, and the hearing aid), MCL, UCL, SDL, controlling adaptive mics, feedback cancellation compared to feedback reduction, how signifigant ear canal size and shape are, counseling the user as well as signifigant others.

    My ipad costs 72.00/month btw.

  17. i am from South Africa and i am trying to get hold of a supplier of a hearing aid below the R12000 PER pair . No one are perpair to publsh their prices.
    Francois Bezuidenhout

  18. What none of you seem to understand is that hearing aids have to be serviced regularly. People with hearing aids are constantly wanting the sound tweaked, and some dont understand that aids wont work if they arent kept clean. So the hearing aid industry is a SERVICE industry, not a retail industry. Most of the cost of hearing aids goes to the person who is going to have to work on the patients complaints, fitting issues, etc. Go ahead and buy a cheap hearing aid online. After a month, when you have gotten used to the sound and need some things adjusted, what will you do. Oh yeah, that guy that sold it to you isnt going to be able or willing to do anything for you and you are stuck with something you cant use. People need to have one on one service to make sure they are satisfied with their instrument. This is the reason hearing aids dont go down in price.

  19. You seem to confuse audiologist services with the manufacturers and their distribution. When I pay for my hearing instrument the price includes the manufacturer’s profit as well as the audiologist’s profit. You usually get one free adjustment where after you PAY for the “tweaks” as you call it. The hearing industry is a service industry yes, said service for which we pay. The manufacturer sells the product at profit and is not involved at all in the service provided by the audiologist, except for warranty claims. The higher the manufacturer’s profit, the higher the audiologist’s price. And THIS is the reason hearing aids don’t go down in price…

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