They Cost WHAT?

Jun 10, 2019 1:44 AM

Far and away, the most common question I get day to day is “Why are hearing aids so expensive?” The answer is complex, but I will try to explain. 

One of the main factors affecting the price of hearing aids is ‘market potential’.  Hearing aids are considered a high tech/low volume product. In the United States roughly 32% of people with hearing loss wear hearing aids.  Currently Annual hearing aid sales in the US is slightly less than 4 million units.   In the US there are about 35 million people with hearing loss. Even if ALL of them bought hearing aids this year, that wouldn’t amount to the number of iPhones sold in the 4th quarter of 2018.  But as already noted, only about 1/3 of people who could utilize hearing aids actually do. So as market potentials go, hearing aids are a pretty small. 

Another significant part of the cost of aids is R&D.  Hearing aids are VERY sophisticated devices.  A not well known fact is that many advanced sound amplifying and processing technologies were invented, or developed by the hearing aid industry. This includes things like directional microphones, digital noise reduction, even the microphone itself.  Hearing aids these days are basically tiny computers operating at up to 500 million instructions per second (MIPS).  500 MIPS is equivalent to the processing power that once drove an Intel Pentium Pro processor. Now that is available in a tiny instrument powered by a 1.4 volt battery.  Of course all that processing power needs to have software running it.  Both the programming built into the hearing aid, and the software that we use to customize each hearing aid is constantly being upgraded. Of course,  those who work with them, like me, need training on those upgrades too!

Manufacturing of hearing aids is precise, and the better ones carry a rating of IP68, which means they are highly dust, and water resistant.  In addition, hearing aids are manufactured to performance specifications dictated by the FDA. This compliance process alone is expensive.

A patient has to have his hearing tested in a quiet area, with sensitive instruments, which have to be calibrated on an annual basis.  Once that has been performed, a hearing health care professional has to take into consideration the hearing loss, the physical attributes of the patients ear, lifestyle considerations, and budget to determine what type of a hearing instrument will work best for the patient. Sometimes this involves making a mold of the patients ear canal.

At this point the hearing aid has been designed, manufactured, and the patient evaluated. Next comes the the fitting process.  This starts with the initial programming of the aid for each ear according to the sound sensitivity of the particular patient. In addition, a fitting involves counseling on placement, maintenance, and adjusting instruments. While a new hearing aid wearer can normally hear better right away, the real benefit to hearing aids comes later. Put simply, it takes time for a person’s  brain to make proper use of the new sounds it is receiving.  That means that hearing instruments require follow up care as a patient acclimates to the new sound, and as  their hearing changes. Periodic evaluations of the patient, and the instruments are required for optimal performance. Finally, there is service for malfunctioning instruments.  Hearing aids are designed to be worn all day, in contact with your skin, with at least part of them down a warm, moist ear canal. Sometimes they fail.

In the US, the average price for a hearing aid is $2300, and most people need two.  Currently the pricing model in the US is ‘front end loaded’, meaning that the cost of ongoing care is included in the initial purchase price.  

I believe this strategy will be changing to a ‘pay per service’ model.  One reason for this is that in 2015 the President's Council of Advisors on Science and Technology recommended that hearing aid prices be ‘unbundled’, and that a category of ‘over the counter’ hearing aids be made available. Consequently  the Over-the-Counter Hearing Aid Act of 2017 became law August 3, 2017.  Contributing to this is that health insurance companies are offering coverage for hearing aids more frequently. Simply put, insurance companies don’t like ‘front end loaded’ pricing. They just do not like to prepay…for anything.  

There is little consensus of how all this new regulation will play out. The hope is that there will be a higher  percentage of hearing aid use, which, in turn would bring prices down.

It is worth noting that in Japan which does not regulate hearing aid dispensing, dispensing is still done primarily by trained professionals, and the prices are similar to the US. On top of that, the usage rate in Japan is half that of the US.  

Another very curious statistic is that in countries where hearing aids are covered by government run health care, the usage rates do not increase as much as we would like.  In the best scenarios, Denmark and Norway have about 42% penetration, and the prices of the aids are still comparable.  In both of these scenarios, consumer satisfaction is below that of the US.  So, in looking around the world at different distribution frameworks, the fitting process, product, and price does not very a great deal. At Hearswell, we pay attention to trends in the industry, and always offer our customers the most cost effective options in hearing health care. Hear Better. Hearswell. Call us at 763-444-4051 or visit