A brutal brawl is shaking up the staid hearing aid business as new technologies – and new players – seek to grab market share. The probable winners: Baby Boomer consumers who will have a wider range of product choices, at lower prices.
The new technologies could not have come along at a more opportune time. According to the Hearing Loss Association of America, about 48 million of us report some hearing loss. At age 65, one in three of us has hearing loss. The aging Baby Boom population means that every day there are more seniors who need hearing aids.
Many are not buying them. According to Alina Urdaneta, vice president of marketing and learning at Signia (formerly formerly Siemens Hearing Instruments), maybe one in four of those who need hearing aids get them.
Why such poor adoption? Two reasons. Traditionally hearing aids have been big, bulky and uncomfortable, and would-be users did not want the stigma of wearing a badge of old age. Reason two: traditional Medicare and many private insurers do not cover hearing aids, even though a typical cost is $4,000 to $5,000 for a pair. That makes this an out-of-pocket expense and, for a senior on a fixed income, it may be prohibitive. Also remember – both vision (eyeglasses) and dental get scant Medicare coverage. Seniors have a lot of health care to pay for out of pocket, and hearing aids may fall off the to-do list.
The good news: new technology is making smaller, better, smarter hearing aids that, in many cases, are invisible (they sit in the ear canal rather than behind the ear, which is where legacy products resided).
There even is good news on the payments front. Urdaneta said that more Medicare Advantage plans – a managed care version of the federal government’s health care initiative for seniors – do in fact cover hearing aids. As more Americans shift into Advantage – currently 17 million, 31% of Medicare recipients are in Advantage, according to data from the Henry J. Kaiser Family Foundation – more will be able to get coverage for hearing aid technology.
Hearing aid prices also are primed to tumble, said Patrick Freuler, CEO of Audicus, a seller of new style hearing aids. “We see prices falling to perhaps $500 per ear. It should be in the hundreds of dollars not in the thousands.”
Raphael Michel, CEO of Eargo, another newstyle hearing aid company, also predicted falling prices: “We can lower the price of hearing aids. Eargo costs $1,980 for a pair.” That price tag, mind you, is well under half of the cost of traditional hearing aids.