Not only do audiologists have a monopoly on these devices, but audiology practices are also inefficient brick & mortar businesses with profit motives and high overheads, and they are forced to charge exorbitant prices just to stay in business.
But in an era where highly complex smartphones are available for under $500, hearing aids simply should not cost thousands of dollars.
Purchasing these small hearing instruments traditionally is a confusing, expensive and frustrating experience - and it's no wonder that only 25% of Americans who would benefit from these aids actually wear them.
The true manufacturing cost of most of these devices is a few hundred dollars, meaning that everyone should have a right to get a hearing aid at a reasonable price.
Instead, many people are left unable to afford them.
Additionally, the hearing aid marketplace is intentionally kept opaque.
Manufacturers develop different names for identical features, making it impossible to compare the aids side-by-side.
Manufacturers often purchase or enter into exclusive agreements with audiology practices, creating skewed incentives for audiologists to favor a single product at the expense of true transparency to the consumer.
The high price for hearing aids from audiologists is due to the fact that they force the customer to purchase a bundle comprised of the hearing aids and an unlimited services contract, masking the true price of these instruments.
Online retailers of hearing aids, by selling directly to the consumer, expose "unbundling" into the marketplace by taking the "amount of service" choice away from the audiologist and giving it to the consumer, who is now free to pay for follow-up service on a pay-as-you go basis.
This allows these retailers to offer lower prices.
The justification the audiologist typically provides when requiring an unlimited service package is that "you never know how many return visits you'll need for adjustments, so you can think of the 'bundled package' as a type of insurance.
" However, most audiologists know that their customers won't be back for that many appointments.
In fact, the average number of follow-up visits in the year after purchase is just under three.
This makes the average cost of an appointment around $500.
But the adjustments are not worth that much, since audiologists provide adjustment services to people who already have their aids, purchased elsewhere, for only $50-75.
Therefore, the consumers who truly benefit from bundled pricing are few and far between, and most are forced to overpay for such simple devices.