Monday 23 May 2011

An answer to the question of hearing aid price....

Here's an answer I posted on the question of hearing aid costs on the Hearing Aid Forums - it's relevant here as it covers my experience of how the industry is 'seen' by the differing groups that make up the industry:

Originally Posted by daerron View Post
The cost of the hardware is a probably a small determining factor in terms of the overall cost picture. The development of the DSP software would amount to a much higher cost overall. This is also where the innovation would be mostly concentrated as hardware gradually improves over time. In addition these devices have to undergo rigorous hardware and software certification to ensure that are fit for medical use and undergo clinical trials which could take a substantial time. There are also environmental tests to ensure that HAs can handle humidity and temperature variances that will be encountered. These kind of tests are very very expensive.. We could mostly blame the regulations around the use of medical devices for their cost, but they are there to protect you.

From the comments so far there appears to be a disconnect (and a bit of distrust) between the medical profession, HA manufacturers and end users... The industry could benefit from having a more open relationship between its end users.

I think it would be quite helpful if users were allowed to adjust some of the settings on the HAs on their own, or create their own personalised profiles or EQ curves (within safe guidelines). The audiologist would basically fit the aid, lock the audio curve response and the end user can create their own custom profiles with software based on this. Can't see why this wouldn't be possible through bluetooth.
Don't forget that the people you are reading from on here represent a self-slecting, tech savvy, motivated group; who's opinions might not fully reflect the needs of the wider hearing community.

The polarity of opinion and arguments may be a little off kilter, but I can make a few observations: 

1: It costs the same to manufacture a high end hearing aid as it does a more basic one - anyone who advocates a top end aid to people without offering the mid-range product is doing them a disservice. Especially if they won't miss the last 0.1% SNR improvement while skiing.

2: Despite assertions against: all hearing aids from the major manufacturers use the same 'quality' mics and receivers - (hardware) individual debris screening systems may be different but otherwise its a level playing field. (NB Soundlens is different)

3: The consumer price of the hearing aid HAS NOTHING TO DO WITH THE COMPONENT PRICE, like the actual value of the piece of plastic that a dentist inserts in your tooth. What you are paying for is the degree of perceived benefit.
a: R+D is a significant cost, but isn't the reason why they are expensive.
b: Hearing aids cost more in wealthier markets: usually as a function of the Audiologists labour time. 
c: An Audiologists pricing model is not for the benefit of individual customers: it is based on the long term survival of their business.
d: When you examine your own personal needs, you are only capable of seeing the sub-micro side of the hearing aids market: the Audiologists also only have a micro view: which means they can't buck the market. The Manufacturers get a Macro view, but they don't want to alter their higher profit situation.
e: Manufacturer delivery is essentially a Cartel mechanism, with large entry barriers, anyone entering the market in the last 10-15 years has been swallowed up or simply doesn't compete with the big boys, who steal their ideas or just out-market them. 

All this was catalysed by a guy called Lars Kolind (who used to run Oticon in the 80s-90s), who basically doubled the sale price of hearing aids using the Mercedes principle: 'If its expensive: people will be attracted by the exclusivity'. This is an unusual paradox, which represents a reversal of normal price elasticity/demand models, but it's why things like Apple products are successful: or perhaps in reverse, why you won't buy a KIA or cheap clothes that perform equally well as their expensive counterparts.

So: beating your Audiologist over the head about price isn't really the answer, nor ZCT's arguments -as valid as they are, or even Govt legislation (they are not medical devices in the UK and pricing is equal); what you have is a peculiar market shaped by the customer, with their collective idiosyncrasies and needs.

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