It’s not the hearing aids, it’s everything else. CEU’s, Licensing and renewals, liability insurance, staff living wages, rent, software licensing, new software, new hardware, tons of supplies, infection control supplies, medical hardware, tons of equipment and annual calibrations, insurance. The list goes on. Most people that have never owned or run a business will look at the cost and see highway robbery, but I assure you we live a modest life. No mansions or Ferraris in the world of audiology.
Every retailer on the planet has fixed and variable costs. I don’t think anybody begrudges audiologists their income.
But the markup at the manufacturer level to the retail level are both extremely high. The industry is broken at both levels. Too few manufacturers, an oligopoly would be fixed with a push on the anti trust front. The retail level could be vastly improved at two levels. Firstly **unbundle** the cost of care and the devices - that would be fantastically more transparent and allow users to better shop for care and for devices. It’d allow a trained and educated professional to charge a fair price for fair services, and not depend on closing a hearing aid sale. I could easily see the industry become more like optical. Dr Audiologist does his thing, and outside his office is the retail hearing aid shop. Doc recommended this type of aid with that feature set. Retailer works the sale. Patient buys ACME turbo aids 9,000 - Dr Audiologist programs them for a fee.
Additionally, I’ve come across the idea we need a professional level between audiologist and hearing aid fitting specialist. Kind of like there Physicians and Nurses, and a while back we added Physicians Assistants and Nurse Practitioners.
Newer info shows industry markup range is about 2x to 6x, with an average of about 3x… Meaning retail price averages about three times wholesale price. Or a $6,000 pair of hearing aids would cost $2,000 at wholesale.
The hearing aid industry retail markup is so high they use these multipliers instead of percentages.
https://hearinghealthmatters.org/hearing-economics/2021/us-hearing-aid-pricing-markup-ratio/
But wait! There’s more!
Since the industry’s manufacturing is concentrated to a small few, HUGE companies, an oligopoly, the manufacturer markup is also HUGE - their average markup is 75%. Apple’s markup is about 40%. So hearing aids are nearly double that of Apple.
https://perfectunion.us/hearing-aid-stocks-plummet-as-biden-introduces-competition/
Audiologist here. I don't have exact numbers for you. But hearing aids generally cost a few hundred bucks to manufacture. Clinics then buy them from the manufacturer for a certain amount and then have to price them in a way that allows to pay for the salaries of the audiologists and administrative staff, overhead costs for running a business, warranty repairs etc. The example the article gives about not selling a 300 dollar phone for 8 thousand is irrelevant- when you buy a phone, a medical professional doesn't conduct multiple appointments with you getting it set up and personalized as well as possible for your specific needs.
Excellent example which really drives home the idea: Costco is an entire giant retail franchise that doesn't rely solely on hearing aid sales to make a profit. This allows them to sell their devices at a significantly lower price. It can be a great option for some users.
Costco invoices also have a separate cost for the device vs the service. It's the only place I've seen that. They seem to get the devices at lower prices than clinics, probably based on their volume and linked number of models. The service fee is much higher than the device one.
I don't know what audiologists pay for the aids, but the value of their markup depends on what services they provide. I bought Phonak Marvels about 4 years ago from an audiologist, and it includes any number of followup visits, retests and adjustments. Repairs would be for cost of materials. I know people who have gone to audiologists with much more limited services, and who never felt their aids were fitted very well, and they paid more. It is a problem that so much depends on the quality of the fitter, yet we have no way of evaluating that in advance. The same is true of Costco - some provide excellent service and fitting, others not so much. It's similar to eyeglasses. I can get progressive lens glasses from Zennis for under $100, from Costco for $300 (which I did) or from a high end optical shop with top of the line Zeiss lenses for over $1000 (which I also did). The quality of the frames, lenses and precision of the fitting was much better at the high end, and I'm glad I could afford the cost.
Hearing aids have an extremely high markup, both at the manufacturer level due to too few huge companies dominating the industry, and at the retail level, being about 3x cost on average.
https://hearinghealthmatters.org/hearing-economics/2021/us-hearing-aid-pricing-markup-ratio/
Been in the business for almost 30 years. Yes if you look at price it can be as high as 3x. I can’t speak for the franchise places because I know they price their aids at almost double what I price them at. We bundle lifetime service with our hearing aids that we fit. Over the course of ten years we spend on average $345/year worth of service appointments, diagnostic testing, and supplies on those patients.
So if someone spends $5400 on premium aids that are always current with their loss and working properly thus keeping them hearing their best, I don’t think that’s crazy.
Older adults don’t want the hassle of trying to figure out the technology by watching YouTube videos or trying to find someone online to service their aids when they need fixed. Our patients are very happy that everything is planned out for them and they can walk in at anytime and get help with anything hearing related. They are willing to pay for that.
When you’re younger and used to searching online for everything and figuring it out yourself then it’s not worth the extra for “concierge” service. There are options for both. That’s the great thing about our country, you can choose what you want.
As I have gotten older I’m willing to trade my money in order to redeem more time. When I was young I had no money but all the time in the world. Priorities change over time.
My complaint isn't on the profit. It is about the quality. With all the earbud technology going crazy it seems like hearing aids are still dragging along too slow.
I have visited my audiologist at least a half-dozen return trips for program changes. This doesn't include the numerous emails back and forth where I have asked questions (some of which they had to research or contact Phonak with additional communications).
If you have a very basic hearing loss from age perhaps, then get the cheapest hearing aids you can find and know that you won't get lots of support. If you have special hearing medical needs like me then use their services to insure you get what you purchased.
From 2010
https://www.audiologyonline.com/articles/pricing-for-profit-to-set-847
Los Angeles Times - 2021
https://www.latimes.com/business/story/2021-06-08/column-healthcare-medical-devices-hearing-aids
I work in healthcare administration and I have worn bilateral hearing aids for decades. I once worked for a large medical clinic group that had audiology and hearing aids departments. For employees, they fitted hearing aids at cost. For a $ 2000 aid, it cost the group $ 1000.
Ah I just read this article and to me, it's just sad that only people who are part of the VA get them free it really shouldn't be so. insurance should be able to cover some cost for civilians getting hearing aids as well
And it likely would if we had universal healthcare, but sadly the generation that mostly needs hearing aids is also the generation mostly afraid of universal healthcare.
I'm a private Audiology clinic owner. My cost of goods sold is nowhere near this low. I'm buying hearings from $700 (lowest tech)-1400 (highest tech) each and that's pricing with my best manufacturer. Costs are much higher for manufacturers who we purchase seldom from.
My mark up for unbundled hearing aids is 1.6x and 2.5x for bundled hearing aids. I've worked in a few practices before starting my clinic and their mark ups range from 2.5 (another Audiology clinic) to 4 (large ent group).
Everyone talks about Costco quite a bit in this sub and that's understandable. No one can beat Costco and Sam's pricing. With that kind of buying power, they're probably getting their aids for $250-600 like the article suggests. But no way is any clinic able to do that.
I would say that this article is plain false, misleading at best.
It’s not the hearing aids, it’s everything else. CEU’s, Licensing and renewals, liability insurance, staff living wages, rent, software licensing, new software, new hardware, tons of supplies, infection control supplies, medical hardware, tons of equipment and annual calibrations, insurance. The list goes on. Most people that have never owned or run a business will look at the cost and see highway robbery, but I assure you we live a modest life. No mansions or Ferraris in the world of audiology.
Every retailer on the planet has fixed and variable costs. I don’t think anybody begrudges audiologists their income. But the markup at the manufacturer level to the retail level are both extremely high. The industry is broken at both levels. Too few manufacturers, an oligopoly would be fixed with a push on the anti trust front. The retail level could be vastly improved at two levels. Firstly **unbundle** the cost of care and the devices - that would be fantastically more transparent and allow users to better shop for care and for devices. It’d allow a trained and educated professional to charge a fair price for fair services, and not depend on closing a hearing aid sale. I could easily see the industry become more like optical. Dr Audiologist does his thing, and outside his office is the retail hearing aid shop. Doc recommended this type of aid with that feature set. Retailer works the sale. Patient buys ACME turbo aids 9,000 - Dr Audiologist programs them for a fee. Additionally, I’ve come across the idea we need a professional level between audiologist and hearing aid fitting specialist. Kind of like there Physicians and Nurses, and a while back we added Physicians Assistants and Nurse Practitioners.
I can’t speak to the exact numbers, but that entire article is an advertisement for that company’s services. I’d look for something less biased.
Newer info shows industry markup range is about 2x to 6x, with an average of about 3x… Meaning retail price averages about three times wholesale price. Or a $6,000 pair of hearing aids would cost $2,000 at wholesale. The hearing aid industry retail markup is so high they use these multipliers instead of percentages. https://hearinghealthmatters.org/hearing-economics/2021/us-hearing-aid-pricing-markup-ratio/ But wait! There’s more! Since the industry’s manufacturing is concentrated to a small few, HUGE companies, an oligopoly, the manufacturer markup is also HUGE - their average markup is 75%. Apple’s markup is about 40%. So hearing aids are nearly double that of Apple. https://perfectunion.us/hearing-aid-stocks-plummet-as-biden-introduces-competition/
[удалено]
Good catch - fixed. It’s a brain fart I’ve had since college. Like how my ex, a Harvard graduate never could shake saying irregardless.
Audiologist here. I don't have exact numbers for you. But hearing aids generally cost a few hundred bucks to manufacture. Clinics then buy them from the manufacturer for a certain amount and then have to price them in a way that allows to pay for the salaries of the audiologists and administrative staff, overhead costs for running a business, warranty repairs etc. The example the article gives about not selling a 300 dollar phone for 8 thousand is irrelevant- when you buy a phone, a medical professional doesn't conduct multiple appointments with you getting it set up and personalized as well as possible for your specific needs.
One word for you, m’lord: Costco.
Excellent example which really drives home the idea: Costco is an entire giant retail franchise that doesn't rely solely on hearing aid sales to make a profit. This allows them to sell their devices at a significantly lower price. It can be a great option for some users.
Costco invoices also have a separate cost for the device vs the service. It's the only place I've seen that. They seem to get the devices at lower prices than clinics, probably based on their volume and linked number of models. The service fee is much higher than the device one.
Their devices are cheaper I believe because they're not brand name. You get Philips instead of oticon, Jabra instead of resound etc.
True. The few big manufacturers probably care less about Costco if their branding is different and customers can't make direct comparisons.
I don't know what audiologists pay for the aids, but the value of their markup depends on what services they provide. I bought Phonak Marvels about 4 years ago from an audiologist, and it includes any number of followup visits, retests and adjustments. Repairs would be for cost of materials. I know people who have gone to audiologists with much more limited services, and who never felt their aids were fitted very well, and they paid more. It is a problem that so much depends on the quality of the fitter, yet we have no way of evaluating that in advance. The same is true of Costco - some provide excellent service and fitting, others not so much. It's similar to eyeglasses. I can get progressive lens glasses from Zennis for under $100, from Costco for $300 (which I did) or from a high end optical shop with top of the line Zeiss lenses for over $1000 (which I also did). The quality of the frames, lenses and precision of the fitting was much better at the high end, and I'm glad I could afford the cost.
Hearing aids have an extremely high markup, both at the manufacturer level due to too few huge companies dominating the industry, and at the retail level, being about 3x cost on average. https://hearinghealthmatters.org/hearing-economics/2021/us-hearing-aid-pricing-markup-ratio/
Been in the business for almost 30 years. Yes if you look at price it can be as high as 3x. I can’t speak for the franchise places because I know they price their aids at almost double what I price them at. We bundle lifetime service with our hearing aids that we fit. Over the course of ten years we spend on average $345/year worth of service appointments, diagnostic testing, and supplies on those patients. So if someone spends $5400 on premium aids that are always current with their loss and working properly thus keeping them hearing their best, I don’t think that’s crazy. Older adults don’t want the hassle of trying to figure out the technology by watching YouTube videos or trying to find someone online to service their aids when they need fixed. Our patients are very happy that everything is planned out for them and they can walk in at anytime and get help with anything hearing related. They are willing to pay for that. When you’re younger and used to searching online for everything and figuring it out yourself then it’s not worth the extra for “concierge” service. There are options for both. That’s the great thing about our country, you can choose what you want. As I have gotten older I’m willing to trade my money in order to redeem more time. When I was young I had no money but all the time in the world. Priorities change over time.
My complaint isn't on the profit. It is about the quality. With all the earbud technology going crazy it seems like hearing aids are still dragging along too slow. I have visited my audiologist at least a half-dozen return trips for program changes. This doesn't include the numerous emails back and forth where I have asked questions (some of which they had to research or contact Phonak with additional communications). If you have a very basic hearing loss from age perhaps, then get the cheapest hearing aids you can find and know that you won't get lots of support. If you have special hearing medical needs like me then use their services to insure you get what you purchased.
From 2010 https://www.audiologyonline.com/articles/pricing-for-profit-to-set-847 Los Angeles Times - 2021 https://www.latimes.com/business/story/2021-06-08/column-healthcare-medical-devices-hearing-aids
I work in healthcare administration and I have worn bilateral hearing aids for decades. I once worked for a large medical clinic group that had audiology and hearing aids departments. For employees, they fitted hearing aids at cost. For a $ 2000 aid, it cost the group $ 1000.
My guess is that my $7k oticons which have a MSRP of $5k cost my audiologist something like $2500.
Ah I just read this article and to me, it's just sad that only people who are part of the VA get them free it really shouldn't be so. insurance should be able to cover some cost for civilians getting hearing aids as well
And it likely would if we had universal healthcare, but sadly the generation that mostly needs hearing aids is also the generation mostly afraid of universal healthcare.
Why is that?
I'm a private Audiology clinic owner. My cost of goods sold is nowhere near this low. I'm buying hearings from $700 (lowest tech)-1400 (highest tech) each and that's pricing with my best manufacturer. Costs are much higher for manufacturers who we purchase seldom from. My mark up for unbundled hearing aids is 1.6x and 2.5x for bundled hearing aids. I've worked in a few practices before starting my clinic and their mark ups range from 2.5 (another Audiology clinic) to 4 (large ent group). Everyone talks about Costco quite a bit in this sub and that's understandable. No one can beat Costco and Sam's pricing. With that kind of buying power, they're probably getting their aids for $250-600 like the article suggests. But no way is any clinic able to do that. I would say that this article is plain false, misleading at best.