Over-the-counter Hearing Aids: How We Got Here and Necessary Next Steps

Frank R. Lin MD, PhD; Nicholas S. Reed AuD


J Am Geriatr Soc. 2022;70(7):1954-1956. 

In their manuscript, "Over-the-counter hearing aids: what will it mean for older Americans?" Dr. Blustein and colleagues describe the potential benefits of imminent release of FDA regulations for OTC hearing aids (e.g., more affordable, accessible, and innovative hearing aids) while also noting that systems are still needed for the provision of adjunctive hearing care services to support older adults in the use of such technologies. As the authors point out, this critical need for both technologic devices and professional services to support patients in the management of a chronic condition such as hearing loss is not unique but unfortunately often seems to be forgotten in the case of hearing loss.

There are myriad reasons for the common perception that hearing aids are the panacea for hearing loss while ignoring the role of hearing care services. For example, some may mistakenly equate the hearing loss that occurs with aging (i.e., presbycusis) to the difficulty with near vision that also occurs with aging (i.e., presbyopia). In reality, whereas presbyopia is a refractive error that can often be fully corrected with glasses, presbycusis is more akin to conditions such as macular degeneration or glaucoma that damage the retina, as such hearing aids cannot fully compensate for the effects of the degeneration in the cochlea that characterizes presbycusis. Adjunctive hearing care services provided by an audiologist are critical to ensuring older adults understand the rehabilitative strategies for optimally communicating with a hearing loss and how to effectively use a hearing aid.

From the public health and policy perspective, however, there are also two root cause federal policies that in large part explain the current predicament of hearing aids being so expensive and the prevailing perception that hearing aids are a panacea for hearing loss. First, when Medicare was established by the Social Security Act in 1965, coverage of diagnostic hearing tests with a medical referral was permitted, but coverage for hearing aids and any related hearing care services were statutory exclusions—leading to the sad paradox that an older adult would be covered to see an audiologist to be told they have a hearing loss but would not be covered for any subsequent treatment. Second, in 1977, the Food and Drug Administration (FDA) established specific regulatory controls for hearing aids, which effectively limited hearing aid sales through only a state-licensed hearing care professional (most commonly an audiologist). Such regulatory controls made sense at the time given that hearing aids of that era could not be safe or effective unless programmed and fitted by a professional.

Over 40 years later, the implications of these policies, which made sense at the time of enactment, have become clear. Because of FDA regulations enabling audiologists to serve as the gatekeepers to hearing aids and concurrent Medicare regulations preventing audiologists from being reimbursed for providing hearing care support services, patients bear the cost of paying for both, which are reflected in the "bundled" price of a hearing aid. The average retail cost of a pair of hearing aids in 2019 is $4500, which reflects both the wholesale cost of the hearing aids (which may only represent a third of the retail cost) and the cost of the audiologist's provision of hearing care services.[1] The services provided by the audiologist become "hidden" in the overall cost paid by the patient for the hearing aid. More importantly, there is also then an overwhelming financial incentive for an audiologist to present and sell a hearing aid as the "solution" to hearing loss in order to receive remuneration for the time that they spend counseling and working with a patient, which would otherwise not be covered by insurance.

The 1977 FDA regulations for hearing aids have also led to significant barriers to entry for any new hearing aid manufacturer who wishes to enter the market. Over time, the market evolved to become extremely vertically integrated, with only a handful of companies dominating hearing aid manufacturing as well as owning large numbers of hearing aid dispensing chains and financing companies to start audiology clinics, which therefore tie audiologists to a single company. At present, only five manufacturers around the world account for ~90% of all hearing aid sales, and other companies wishing to enter the hearing aid market are unable to easily do so since they would not be able to sell directly to consumers. From an economic perspective, the end result is a low-volume, high-margin market of hearing aid sales, whereas the economic model for most consumer electronics is high-volume, low-margin.

Changing this current paradigm to allow for a more rational system requires policy reforms to both historical federal policies. In a more rational system, patients would have easier access to more affordable and innovative hearing aids as well as access to hearing care support services similar to the professional services that are covered by Medicare for the management of other chronic conditions (e.g., diabetes counseling, low vision rehabilitative therapy, etc.).

Fortunately, as the manuscript from Blustein et al. summarizes, reforms to the 1977 FDA hearing aid regulations are now underway. Based on recommendations from the White House President's Council of Advisors on Science and Technology (PCAST) in 2015[2] and the National Academies in 2016,[3] the bipartisan OTC hearing aid act was passed and signed into law in 2017 and instructed the FDA to create a separate regulatory classification for OTC hearing aids intended for adults with mild-to-moderate hearing loss. These draft regulations were released in October 2021 and are set to be finalized by July 2022, with enactment thereafter by September 2022. These regulations detail the specific technical and labeling requirements for future OTC hearing aids to ensure that they will be safe and effective (similar to other FDA-regulated consumer medical technologies such as home blood pressure machines and thermometers) while also providing a clear glidepath for new manufacturers to enter the market. Such companies will be able to directly market and sell these technologies to consumers at prices that are expected to be eventually comparable to now ubiquitous wireless earbuds.

However, as Blustein et al. correctly point out, while some adults may be able to benefit from such technologies without additional help, others will need the guidance, counseling, and instruction of an audiologist to learn which OTC hearing aids to use and how to adapt these technologies to their lives. This presents a prime opportunity for complementary legislation to ensure that such hearing care support services become covered and available to adults.

The now stalled Build Back Better Act proposed by the White House in October 2021 included Medicare expansion of such hearing care services.[4] The details included two key provisions to complement OTC hearing aids. First, coverage would be provided for conventional/prescription hearing aids and related services for those with moderately severe or greater hearing losses who may not benefit from OTC hearing aids. Second, the bill removed the original 1965 statutory exclusion of services related to hearing aids and opened the door for coverage of hearing care support services for all Medicare beneficiaries. The final details on reimbursement for hearing care support services would fall to the Centers for Medicare and Medicaid Services but would broadly include services such as counseling for selection and use of devices, technologic support such as adjusting hearing devices for optimal output, maintenance, and rehabilitative strategies for use. Such services would provide a safety net for older adults who cannot manage their hearing care on their own and maximize the effectiveness of OTC hearing aids purchased by older adults. Moreover, the reimbursement of services independent from the sale of a hearing aid changes the incentive structure for audiologists and allows them to focus on providing hearing care support services: a fundamental shift back toward patient-focused hearing care and away from having to sell a hearing aid.

While the passage of the $1.75 trillion Build Back Better Act is now stalled in Congress, the future passage of the bill's Medicare hearing benefit is essential to complement the imminent availability of OTC hearing aids and allow for a hearing care ecosystem that has both a competitive, innovative market for hearing aids and the availability of professional audiological support services for patients. The public health implications of such a robust hearing care system could be immense. Hearing loss has been estimated to be the largest potentially modifiable risk factor for dementia.[5] The pending results of a major NIA-sponsored clinical trial (NCT03243422) that will determine the impact of hearing aids on cognitive decline among older adults coupled with the recent U.S. government's 2021 National Plan to Address Alzheimer's Disease recommendation[6] of increasing access to hearing aids to prevent dementia may be enough to propel the reintroduction of this legislation for a Medicare hearing benefit in the near future.