Why are hearing aids so expensive?

Larry Hicks was diagnosed with severe deafness about 6 months ago. He’s a little embarrassed to say it’s because he exploded crazy high-pitched music in the car.

Burbank residents are currently buying hearing aids and are sick of the cost. As much as $ 6,000 For pairs.Medicare and most private plans Do not cover the hearing aid..

“I feel like I’m devouring prices,” Hicks, 51, told me. “They use people with disabilities and the elderly.”

It’s hard to argue. Medical devices are a classic example of a relatively small number of manufacturers taking advantage of proprietary markets with overly high list prices.

Whether talking about hearing aids, insulin pumps, pacemakers, or other life-changing technologies, patients are often forced to pay far more than the cost of developing and manufacturing a device. ..

“The medical device industry is mostly olioli management, and some companies are virtually monopolized,” said Roberta, an adjunct professor of social policy and management at Brandeis University who specializes in medical marketing. N. Clarke said.

“Medical device companies can charge higher prices because there is less threat of competitors entering the market at lower prices,” she said, due to limited competition.

“This effect is exacerbated by the close relationships that medical device companies have with doctors,” said Clarke.

There are many mistakes in the $ 4 trillion US healthcare system, and we don’t know where to start fixing. Perhaps that is one of the reasons lawmakers hesitate to take on the challenge.

I wrote about the other day Start with price transparencyI insisted that hospitals and doctors imitate Amazon’s simple cost display before customers buy.

Expensive medical devices are another area where reforms are ripe. This is another step towards building a healthcare system that does not prioritize the interests of the patient.

The United States has the largest medical device market in the world, which is not surprising given the population, wealth and technology of the United States.

Ah Recent reports Grand View Research estimates that approximately $ 177 billion worth of medical devices were sold in the country last year. Sales are projected to reach $ 186.5 billion this year.

By 2028, the report forecasts US sales of medical devices to reach $ 262.4 billion. This is an increase of about 48% from last year’s total.

“The rising prevalence of chronic diseases and the growing elderly population in the country are the main drivers of the market,” concluded Grand View researchers.

Defenders of the current state of health will immediately take advantage of innovation cards. They will argue that due to the high cost of medical devices, companies will continue to seek technological advances, which can save lives.

There are circumstances in this. See the billions of dollars invested in the development of the COVID-19 vaccine at record speed. No pharmaceutical company or research institute has participated in the competition without expecting a large payday in the future.

But as with all health care issues, the key question is how much profit is sufficient.

No one laments device makers or pharmaceutical companies that are making reasonable profits or recovering millions of dollars in R & D. It’s just fair.

The current problem is that prices never go down. List prices continue to rise, even after many R & D and marketing costs have been amortized and economies of scale have been realized.

All other state-of-the-art consumer goods (TVs, laptops, mobile phones) will become cheaper over time, reflecting the fierce competition in the market.

Most medical devices and prescription drugs become more expensive over time. This is mainly due to the costly barriers (R & D, patents, etc.) to enter these markets. In addition, these products require strict regulatory approval.

Less competition almost always means higher prices.

But what do you call this? It is to use a sick person.

“It’s wrong to use a sick person,” admits Matthew Grennan, an assistant professor of health care at the University of Pennsylvania. “But I don’t know where the line is.”

This means that from an economic point of view, it is difficult to completely reject ultra-high prices for medical advances.

“Medical devices are this strange kind of product, which is relatively low in manufacturing cost but high in value they produce,” Grennan told me.

Creating “value” is a major challenge in the healthcare industry. Basically, the argument is that treating illness and managing chronic illnesses can bring tremendous value to society and can be charged as much as you like.

When the pharmaceutical company Gilead Sciences launched the hepatitis C drug Harvoni in 2014 at a list price of $ 1,000 or more per tablet, Defended the mercenary movement “The price of Harboni reflects the value of the drug.”

It doesn’t cost much to develop. It’s not how much it costs to make. “Value” for patients and society. And what value do you value in human life?

Grennan said economists appreciate the debate. “Value” is a legitimate economic proposition and is valuable.

As someone who is forced to pay thousands of dollars each year to manage a chronic illness, I say “value” is just an excuse for businesses to write blank checks.

At some point, the value of drugs and devices to society needs to be accepted as a new standard and priced accordingly.

As mentioned earlier, hearing aids cost thousands of dollars on a daily basis, but most insurance companies don’t cover hearing aids, so most people pay for them directly.

As far as I know, almost all of the main parts of hearing aids come from Asia, and many parts are also manufactured in Asia.

It’s hard to know how much it will cost to make a hearing aid.There is a reference to New York Times And Elsewhere To a low manufacturing price of $ 100.

Grennan called this a realistic estimate. He said more sophisticated hearing aids could cost $ 200 or $ 300 to manufacture.

Ah 2015 report Former President Obama’s Science and Technology Advisory Board has set a standard suggested retail price of $ 2,400 for a single hearing aid. This is a 1,100% increase if the device costs $ 200 to manufacture.

“Technology innovation hasn’t reduced costs,” the report said, stating that nearly half of the total population over the age of 60 has deafness.

Captive market. The price is steadily rising. Huge markup.

It’s not worth it. It’s immoral.

Why are hearing aids so expensive? Source link Why are hearing aids so expensive?

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