Many readers may be surprised to learn that hearing loss is the third most prevalent health issue in the US as there are over 37 million adults in the United States that suffer from some degree of hearing loss
. However, only 20%-30% of individuals suffering from hearing loss are utilizing hearing aids, and hearing aid users on average wait 7-10 years after their initial diagnosis before being fitted for a device. The combination of these forces creates a significant US health issue as untreated hearing loss is linked to social isolation and increased likelihood of depression, dementia, and falls.
These staggering statistics made us contemplate the future of the hearing industry. What factors have contributed to the underutilization and access issues? What are industry players, including companies, providers and regulators doing to advance the industry and address some of the legacy challenges?
To begin, it’s important to think like the average consumer and navigate the decision to buy or not buy a hearing aid. Based on our review of the industry, we have identified three challenges (or opportunities!) for the hearing industry to overcome:
- Lack of Transparency and Support: A combination of realities has caused consumer confusion and frustration when it comes to hearing aids. Where do I buy a hearing aid? Choose from any of 15,000 hearing care providers across the U.S. What’s the right model for me? There are hundreds of different hearing aid models with varying levels of technology and different styles (in the ear, behind the ear, other). How much should I pay for a hearing aid? What type of service should I expect once I’ve purchased? Unfortunately, pricing for hearing aids varies dramatically and it is difficult to understand what is driving the price: the quality and technological advancement of the hearing aid and / or the services performed by the provider.
- Limited Payer Involvement: Medicare and many health plans do not cover hearing aids. Those health plans that do have a hearing benefit have generally taken a passive approach to hearing health – meaning, members can receive hearing care anywhere and health plans do not control costs or manage the member experience. This results in highly variable hearing aid costs and member experiences.
- Social Stigma: Stigma associated with wearing hearing aids can be a big obstacle to hearing aid adoption. Many individuals are hesitant to wear hearing aids due to their historical bulky styling and association with old age.
Fortunately, these historical obstacles to hearing aid adoption are being disrupted by innovative companies, changing social norms, recent regulatory changes, more sophisticated technology, and a growing number of health insurance companies providing hearing aid benefits. Let’s look at a few examples of how the hearing industry is transforming:
- TruHearing is a leading hearing benefits solution provider partnering with Medicare Advantage and Commercial health plans nationwide to help them shift from a passive approach an active approach to managing hearing benefits. The Company controls hearing aid costs and provides an end-to-end, consumer-centric experience for health plan members seeking hearing aids. TruHearing’s innovative approach to partnering with health plans increases access to affordable hearing aids and allows TruHearing to serve as a trusted advisor throughout the entire purchasing experience, while ensuring members see a high quality provider. TruHearing recently announced its strategic partnership with Sivantos where TripleTree acted as the exclusive financial advisor to TruHearing.
- A combination of evolving social norms and advances in hearing aid technology / form factors is reducing the social stigma adoption barrier. There has been a recent consumer trend of using wireless in-ear electronic devices (e.g., Apple’s earpods), so wearing a device in the ear is becoming less and less associated with old age. At the same time, hearing aids are becoming more discreet in design and starting to incorporate consumer electronic features like music streaming and the ability to talk on the phone through the hearing aids. Eargo is a venture capital backed start-up with an innovative product that addresses both social stigma and cost concerns for prospective hearing aid users. The Company offers a virtually invisible hearing aid sold online or over the phone at a price ~50% less than other alternatives.
- Hearing care providers play a critical role in hearing aid adoption as they help with diagnosis, fitting, patient counseling, training, ongoing support and education, all of which are key factors that determine patients’ success with hearing aids. Alpaca, an audiology negotiating network backed by Thompson Street Capital Partners and Beverly Capital partners, recognizes the importance of hearing care providers. With a mission to unify and empower hearing care providers, Alpaca enables providers to control purchasing costs, operate more efficiently, and grow their practices.
- The OTC Act of 2017 is recently enacted legislation intended to address the obstacle of required clinical interventions by allowing individuals with mild to moderate hearing loss to purchase a hearing aid over-the-counter without being seen by a hearing care professional. While OTC takes a step toward improving access to hearing aids earlier in the hearing loss journey, there are still many unknowns as OTC legislation currently does not define key elements such as location of purchase (i.e. behind-the-counter or off-the-shelf), use of warning labels and definition of what constitutes mild-to-moderate hearing loss.
You may be wondering: what is the end result of these changes in the marketplace? The confluence of favorable demographic trends, emerging innovative technologies, growing health plan involvement, and regulatory momentum is placing the hearing market at an inflection point, creating substantial opportunity and growth potential for all industry constituents. Most important, these trends are providing individuals with hearing loss with better access and support to hearing health products and services.
Let us know what you think – we would love to hear from you.