Silencing the Competition: Inside the Fight Against the Hearing Aid Cartel

Keep in mind that most people don’t wear hearing aids so they don’t care how much anyone is paying for them.

@jeffrey said:

How many here have felt their audi was in on an indefensible scam and looking to fleece them with no regrets? Not me.

I, for one, would never go to this extreme. I’m only expressing some disappointment that there aren’t at least a few vocal audiologists saying out loud “Hearing devices cost too much through our channel of distribution. Give is the means to offer fairer prices and better deals to our parents.” It’s just the right thing to do, given the current industry model.

There’s no need to go to the hyperbolic extremes you’re injecting into what could otherwise be a rational and informative discussion of our fair observation. The histrionics just render it impossible to have a constructive discourse.

Well, I was merely trying to suggest, by appealing to our common experience of the people in this industry, that maybe things aren’t so dire. In terms of hyperbole, well:

@kevels55 said:

using every trick in the book to disguise their manoeuvring… Ultimately, what sticks in my craw, is the pretentious moral high ground they portray to this hearing world,

@kevels55 said:

But, surely a few would stand up, and defend their industry, it may be their business model is so corrupt, it is undefendable?

I’m going to suggest an alternative to this last quote: people in the industry are not silent because their business is “undefendable”. Rather, they aren’t speaking out because, like grocers, or car dealerships, or insurance agents, or a hundred others, they in fact do offer a service and so deserve to charge a fee. If the business was so far over the top corrupt, yes, people would speak out, or write exposes, or contact a news agency. Look at Facebook. People there are speaking out.

I may have a naive faith in the decency of people in the aggregate. I trust that someone will stand up and speak out when required. Is this hyperbole? So be it.

Well, here is one provider that will jump into this quagmire. I will not defend the manufacturers when Costco can buy product for 1/3 what a private practice professional can. As for audiologists and hearing instrument specialist, it takes a certain amount of money to keep the doors open. I have been in the industry for over 40 years and have seen many go out of business, both those thinking by charging less they will make a killing on volume and those charging too much thinking they don’t need a lot of volume if the price is high enough. Overall though, most practices charge what is necessary to keep their doors open and equipment up to date, calibrated and pay their bills. I could have made a lot more money going into a different industry but I enjoyed helping people hear better. I worked mainly with seniors and they are a great group of people to work with (I am proud to say I am in that category now). For the consumer, the hard part is finding the right professional to work with, one that cares and uses Best Practices. Costco has their good ones, their mediocre ones and their bad ones. The same goes for private practice, whether it is an AuD, PhD, MD or HIS the consumer must do their due diligence. The OTC will be interesting to watch. Many will be helped but I am sure many will try it and not be satisfied and then say “I knew hearing aids were no good” and give up trying to find help. You can never make everyone happy, just reading some of the comments on this forum will prove that.

$1200 CND converts to about $1000 USD. I don’t think you could get a comparable pair in US for that kind of money. Real world example. Phonak Paradise 30 sells for $2500 USD at Northern California Kaiser. Their prices seem pretty competitive from what I’ve seen in our area. Costco’s cheapest is $1400 USD currently. I agree that from what I’ve seen of OTC (Bose) seems to be no bargain because of what one gives up in service and guarantee.
Regarding charity. I know Starkey has a low income program in the US. I also know Lion’s Club recycles and refits donated hearing aids. Hearing aids are often a covered benefit of Medicaid, but benefits and requirements vary state by state.

(The HCP’s silence is perhaps “Deafening”, if you’ll pardon the pun, it was intensional … But, surely a few would stand up, and defend their industry, it may be their business model is so corrupt, it is undefendable? )

The manufacturers are multi national corporations with huge marketing budgets, their own dedicated supply lines to the high street and massive contracts with big-box stores.

Independent dispensers form somewhere between a third and a quarter of high street outlets. How exactly can we leverage the cartel of multinational suppliers when they decide at what point in the supply line they take the profit. They can easily put more squeeze on the independent sector by bumping the wholesale price.

Phonak recently had an offer with Specsavers in the U.K., that put the aids out at the ‘wholesale price’. Boots(Walgreens) hearing is 50% owned by Phonak, ran a similar offer.
It’s impossible to compete with this kind of squeeze going on; fortunately DeMant and other suppliers recognise that the independent sector still offers a level of service that people like, plus COVID has moved the focus back to smaller separate fitting locations over the large ‘splash and dash’ versions.

I’ll add my two cents as a provider, one that has worked on both U.S. costs and in the Midwest. This article is slightly disingenuous and it makes a lot of false assumptions from an outsider’s perspective. I think it’s rather dangerous to try to get people to believe hearing aids are just adjustable microphones (which a microphone isn’t even an output device, so it’s very incorrect terminology). I’ve had numerous patients wear OTC/PSAP devices and struggle because the devices amplify and do not aid their loss specifically. Hearing and the science behind hearing is not a matter of turning the volume up to correct the issue. If that worked, half my patients wouldn’t still have an issue hearing television when turning it up.

Do I believe a market for OTC exists? Yes. Is price the main argument I hear in practice against wearing aids? Not even close. Nowadays, you have Costco and many other retailers that fit quality devices and provide numerous free services for a fraction of the $4800 per pair number quoted. To counter the point in the replied comment, you can even show a Costco membership card at Connect Hearing and they should offer you a discounted price of $1400-$1500 for Audeo 30 technology (insider trick), albeit I believe services can be excluded. I still get numerous patients though that will not wear a hearing aid due to vanity, due to not wanting something in their ear, etc. And if we were to charge for hearing tests, less people would be open to the idea of seeking help. So the service costs are born from the model of having to pay for audiologist time, pay for equipment, pay for rent and bills and still 50% of people reasonably not purchasing after asking for your time/professional opinion for free.

I believe less of us HCPs respond to this article/post because of the amount of misconceptions presented and how long it would take to address every single one. Ultimately, OTC/low cost aids have been around for a long time, and it just takes seeking them out. I think the main argument trying to be presented is people want the high end hearing aid technology (i.e. Phonak Audeo 90) for OTC prices, even though most people with a mild-moderate hearing loss can get Audeo 30/mid level devices for reasonable prices and services fees if they’d do more research.

It was nice of some professionals to state their case, and in some instances very enlightening, thank you… I have no gripe with the HCP’s, none whatsoever! The vast majority of whom, do so, to help their HOH clients function better, in this hearing world. And yes, there are most certainly a few, “Charlatans”, out there, but that should not blind us, to what virtue there is… For me, the “Hearing Aid Manufacturers”, are the ones pulling all the strings, the independent HCP’s are made to dance to their tune, HAMs does sound appropriate though… Ultimately, do we trust these HAMs, probably not, should we, “tar them all with the same brush”, most likely that’s a yes, until proven otherwise… Cheers Kev

Jim , yes, I agree that self driving cars is a bad analogy! (they haven’t lived up to the hype, to say the least. they haven’t lived up to the hype.) Does your computer ever go on the fritz? Your printer? Of course. Trouble free high tech is always just around the corner. Sometimes you gotta call for help. Modern hearing aids are complex. I don’t know that we can count on rarely or never having to seek help with them in the near future. And again, it’s likely many members of this forum are adept at tech and self programming. Not me; I’d guess the majority of people aren’t either. For us, having a dispenser open six days a week to take me as a walk in for cleanings and trouble shooting, diagnoses and sometimes immediate fixes really is worth the money.

@kevels55 said:

It was nice of some professionals to state their case, and in some instances very enlightening, thank you… I have no gripe with the HCP’s,

@kevels55: Once again, I concur. There were some enlightening comments. I learned from @Neville to take into account the burden it would be on independent HCPs to engage the HAMs in the theatre of politics. I also appreciated his pointing out the importance of transparency and client education. I feel that this is within the independent HCPs’ power to do much more.

I agree that endless trials at no cost to the client are a burden - but why aren’t those in private practice trying actively to shift part of this cost onto the HAMs?

There’s indeed, a lack of good options, but surely the independent audiologists could suggest possibilities that would work for them, and their clients, too?

@Um_bongo’s comments lead me to believe all the more that the key to exerting leverage on the HAM bloc is an active and vocal partnership between independent audiologists and their clients. This practitioner knows the answer: [transparency + client education]. How come there’s not more of it?

I believe there’s a certain desperation that hangs over the heads of those who would challenge the HAMs, but @tenkan has probably put his finger on it.

[Edit:] The current paradigm must be dismembered and disarticulated before it can be effectively reconstituted and replaced.

I will give some other counter arguments to more points, because I do not agree that the analogy of a “cartel” is appropriate by any means.

In terms of mergers and monopolies, the argument is being made that less competition and more controlled supply chains equal a larger cost to the consumer. I actually see the opposite from a hearing care provider standpoint. I see companies like Sonova for instance able to diversify their holdings, pulling together management, research and supplies from within its network and lowering costs across the board. I see companies like Connect Hearing, which has always been rated high by Consumer Reports, as able to control the narrative around their product and ensure quality control on their product fittings. While I know profit is greater this way, the reasoning for merging and sharing technology goes well beyond profit.

A question came up regarding HCPs and why they care to work for manufacturer owned outlets. A lot of HCPs enjoy working for manufacturer owned outfits like Connect Hearing because the process is more streamlined, there is more internal support for insurance and product rollout and the benefit packages are much better than independent practices. As a former owner of an independent practice, it is a lot of work to run your own clinic and the rewards are minimizing with the cost of business increasing in real estate, advertisement and utilities. It is much easier having someone else take that burden off so we can focus on our patients hearing needs.

A final counter argument is roughly about 10% of my patients have the technical capability to fit their hearing loss, or even the understanding of what a hearing loss is to begin with. For many on these forums, it may be an attractive option. But 90% of my clientele will still need a provider to handle explanation, adjustments and repairs regardless of what technology brings in the future. My fear as a HCP, as I’ve seen with PSAPs, is ordinary people being confused by an OTC product vs. a prescriptive product, where they make assumptions on if they can be helped or not. What if a severe loss candidate tries a OTC product and because it doesn’t help they avoid seeking further support. It’s a huge disservice and an ethical dilemma. How are they going to prevent people with severe hearing losses from purchasing products that will not help them?

Ultimately, if insurances were mandated to offer more hearing aid coverage, prices would fall and have been falling as this has occurred the last few years. That’s why hearing aid companies are forming hearing aid insurance contracts, like with TruHearing, HCS, and UHC. It’s allowing companies to offer discounted rates/prices and share the cost burden with the insurers for the patients benefit. The real target should be the insurance companies vs. the actual hearing aid industry in my professional opinion.

@SpudGunner said:

Books are not a niche medical product whose production is in the hands of a tightly-held oligopoly.

Speech is free and universal, unlike hearing aids.

Well, actually…Amazon IS a tightly held oligopoly. Amazon DID lose money on books (tax free, by the way) for many decades, selling them at a loss effectively below cost in order to kill storefronts.

Speech may be free, but ask an author who spent five years working on a novel if he or she expects to give it away. And anyway, myself and the staff need to be paid. We have rent and all the rest to think about. so do the publishers, so do the authors.

Amazon makes HA manufacturers pale by comparison.

I see that you’ve edited your initial post. That’s fine! I do it too. I was responding to your post, as quoted in my own. In any case, I didn’t mean to be aggressive. I was merely pointing out the potential consequences of 'breaking up the paradigm, with no established plan B. Amazon made famous the notion of creative destruction. A lot of people lost their jobs as part of that destruction. We ended up moving ever more towards a cartel economy. You’re calling for the opposite of that. I agree! I worry about breaking the dishes and having nothing to put the evening soup into.

@jeffrey said:

I didn’t mean to be aggressive. I was merely pointing out the potential consequences of 'breaking up the paradigm, with no established plan B.

Well, sorry: I took your comments as a tad aggressive because they assume me to be so cavalier as to advocate the destruction of A without plan B. We never go into battle without several Plans B, C, D, etc.

Amazon can’t be called an oligopoly in the context of our discussion. Amazon and just a few large competitors could be called an oligopoly, but not Amazon, on its own.

@lewiii8 said:

A final counter argument is roughly about 10% of my patients have the technical capability to fit their hearing loss, or even the understanding of what a hearing loss is to begin with.

Yeah, if that. The specific population on this site is not illustrative of the regular population of hearing aid users.

It can go so far the other way that it actually gets pretty weird. Like, someone brought in their “broken” hearing aids the other day and the charger was 100% caked in dirt. Visible, obvious, dark brown dirt. Like it had been dipped by the wire in a mud-puddle and then left to dry. And it’s not upsetting that they are angry at YOU about the hearing aids malfunctioning, because it’s just very confusing.