03 January 2019
Posted on 31 July 2018
In the hearing aid industry, negotiations have been a bumpy ride. Hearing aid specialists feared that a Big Bang would undermine their business model. Discontent focused particularly on invoicing separately for the supply of devices and their on-going maintenance. None of this happened. On this point, discussions ended in a status quo: tomorrow as today the sale price of a hearing aid will also cover maintaining the device and professional advice throughout the warranty period. However, when it comes to reducing co-pay, the result of the negotiations is spectacular. “Zero co-pay” will come into effect from 2021 as a result of a drastic cut in pricing and a significant increase in the cover provided by first and second tier health insurers.
Today 57% of the price of hearing aids remains for the customer’s account. Given the average price of €1,500 per ear to be correctly fitted out, an insured is left with a cost of €850 per ear, i.e. €1,700 in total. For many people with hearing problems, any financial effort is just out of the question.
Between now and 2021, the amount remaining for the patient’s account will be cut to zero in three stages: co-pay will be reduced to €1,300 (for the two ears) in 2019 and then to €800 in 2020 and finally to 0 in 2021. This benefit will be restricted to a “100% healthcare” basket comprising a number of types of device capable of providing at least 30 decibels of amplified sound output and 12 adjustment channels. Just as for dentistry and optical aids, the agreement provides for a further benefits category with price caps and another with prices fixed freely. What is different with hearing aids, compared to the other sectors, is the size of the reduction in price capping that has been negotiated with the industry. After capping at an average of €1,500 in 2019, the maximum sale price will fall to €950 in 2021. At the same time Social Security (the first tier system) will double its cover from €120 to €240, while second tier (complementary insurers) will gradually absorb the remaining co-pay.
In France, whilst 6 million people suffer from hearing problems, only 2 million have the benefit of hearing aids. After the reform, it is estimated that the number of people fitted with devices could reach 3 million. Hearing instrument specialists are counting on volumes to compensate for reduced prices. Some manufacturers are, in fact, hoping for a market increase of 7% to 8% in volume per annum.
The benefits of the reform for people with hearing problems is just staggering. However, when it comes to hearing problems, price is not everything. A lot of people are reluctant to admit or show that they are hard of hearing. This is why the agreement also provides for a dose of prevention and communication. Pushing “zero co-pay” and breaking down the barriers to seeking help on hearing loss will be good for specialists’ business. What about those who finance the system, who might fall victim to the success of this reform? The State authorities prefer pointing to the reduction in risk stemming from treating hearing loss: social alienation, depression, cognitive disorders or falling. On the other hand, complementary health insurers fear the effects of a reform that could not so much hit corporate group schemes as individual policies, much more frequent among retired people.
A question for Gerep: Will 100% cover for hearing aids mean premiums will rise on some types of policy?