United States. Congress. Senate. Special Committee.

The hearing aid marketplace : is the consumer adequately protected? : hearing before the Special Committee on Aging, United States Senate, One Hundred Third Congress, first session, Washington, DC, September 15, 1993 online

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( ^ y S. Hrg. 103-361

\v) THE HEARING ATO MARKETPUCE: IS THE
CONSUMER ADE QUATELY PROTECTED?

/ 4, AG 4: S. HR8. 103-361

[he Hearing Aid Harketplace: Is the...



HEARING

BEFORE THE

SPECIAL COMMITTEE ON AGING
UNITED STATES SENATE

ONE HUNDRED THIRD CONGRESS

FIRST SESSION



WASHINGTON, DC



SEPTEMBER 15, 1993



Serial No. 103-12




MAR 1 1 J53^



Printed for the use of^the Special Committee on Aging



U.S. GOVERNMENT PRINTING OFFICE
74-693 WASHINGTON : 1993



For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402
ISBN 0-16-043424-6



S. Hrg. 103-361

THE HEARING AID MARKETPUCE: IS THE
CONSUMER ADE QUATELY PRO TECTED?

' 4. AG 4: S. HRG. 103-361 ' — — ==

he Hearing Aid flarketplace: Is the...

HEARING

BEFORE THE

SPECIAL COMMITTEE ON AGING
UNITED STATES SENATE

ONE HUNDRED THIRD CONGRESS

FIRST SESSION



WASHINGTON, DC



SEPTEMBER 15, 1993



Serial No. 103-12





MAR 1 1 gg^



Printed for tile use of^the Special Committee on Aging



U.S. GOVERNMENT PRINTING OFFICE
74-593 WASHINGTON : 1993



For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402
ISBN 0-16-043424-6



SPECIAL COMMITTEE ON AGING



JOHN GLENN, Ohio

BILL BRADLEY, New Jersey

J. BENNETT JOHNSTON, Louisiana

JOHN B. BREAUX, Louisiana

RICHARD SHELBY, Alabama

HARRY REID, Nevada

BOB GRAHAM, Florida

HERB KOHL, Wisconsin

RUSSELL D. FEINGOLD, Wisconsin

DONALD W. RIEGLE, Jr., Michigan



DAVID PRYOR, Arkansas, Chairman

WILLIAM S. COHEN, Maine
LARRY PRESSLER, South Dakota
CHARLES E. GRASSLEY, Iowa
ALAN K. SIMPSON, Wyoming
JAMES M. JEFFORDS, Vermont
JOHN McCAIN, Arizona
DAVE DURENBERGER, Minnesota
LARRY CRAIG, Idaho
CONRAD BURNS, Montana
ARLEN SPECTER, Pennsylvania



Theresa M. Forster, Staff Director
Mary Berry Gerwin, Minority Staff Director / Chief Counsel



(II)



CONTENTS



Page

Opening statement of Senator David Pryor, chairman 1

Statement of Senator:

William S. Cohen 6

Herb Kohl 9

James M. Jeffords 20

Larry Pressler 77

Russell D. Feingold 81

Charles E. Grassley 83

Prepared statement of Senator:

Richard Shelby 3

Donald W. Riegle 4

Alan K. Simpson 4

Dave Dvirenberger 5

Larry Craig 6

Chronological List of Witnesses

Doris H. Lomax, Tampa, FL 11

Miles Kidd, Kanawha, WV 22

David Kessler, M.D., Commissioner, Food and Drug Administration, accom-
panied by Joseph Levitt, Deputy Director, Center for Devices in Radiologi-
cal Health 27

Dr. Margaret Dixon, vice president, American Association of Retired Persons . 40

Don DarUng, deputy attorney general, State of West Virginia 53

Donna Sorkin, executive director. Self Help for the Hard of Hearing People

Inc 62

Jerome Goldstein, M.D., executive vice president. Academy of Otolaryngology 85
Dr. Thomas O'Toole, president, American Speech-Language-Hearing Associa-
tion 93

Robin Holm, executive director. International Hearing Society 103

Appendix 1

Booklet released by the AARP entitled "A Report on Hearing Aids, User
Perspectives and Concerns" 149

Appendix 2

Response and supporting documents from the American Association of Retired

Persons in answer to questions from Senator Simpson 215

Testimony from "Miracle-Ear" in response to hearing 237

Appendix 3

Testimony from the Federal Trade Commission outlining their activities ad-
dressing problems in the hearing aid industry, submitted by Janet Steiger,
chairman 243

Testimony from the Department of Veterans Affairs, submitted by Lucille
B. Beck, Ph.D., associate chief, Audiology and Speech Pathology Service 264

Testimony from the American Academy oiAudiology 283

Testimony from the Hearing Industries Association, submitted by Carole
M. Rogin, president 314

Testimony from the Wisconsin Alliance of Hearing Professionals, submitted
by Douglas Q. Johnson, executive director/general counsel 329

Statement of Arthur J. Greles, Information Systems Director for Senator
Paul Simon and member of Self-Help for Hard of Hearing People, Inc 351

(III)



IV

Page

Statement of the American Academy of Audiology: Hearing care services
and health care reform, submitted by Thomas J. OToole, Ed.D., president
of the American Speech-Language-Hearing Association 353



THE HEARING AID MARKETPLACE: IS THE
CONSUMER ADEQUATELY PROTECTED?



WEDNESDAY, SEPTEMBER 15, 1993

U.S. Senate,
Special Committee on Aging,

Washington, DC.

The committee met, pursuant to notice, at 10:05 a.m. in room
DG-50, Dirksen Senate Office Building, Hon. David Pryor (chair-
man of the committee) presiding.

Present: Senators Pryor, Grassley, Cohen, Kohl, Jeffords,
Feingold, and Pressler.

Staff present: Theresa Forster, staff director; Gregory Smith,
chief counsel; Mary Berry Grerwin, minority staff director; Helen
Albert, investigator; and Priscilla Hanley, professional staff.

OPENING STATEMENT OF SENATOR DAVID PRYOR, CHAIRMAN

The Chairman. Grood morning, ladies and gentlemen. We want
to thank all of you for attending our hearing of the Special Com-
mittee on Aging, relative this morning to hearing aids.

First, we want to say a special word of thanks to our guests who
will be on our panels this morning. Some have come from a long
distance; we're very, very appreciative of your attendance.

Also, let us take note of the fact that this afternoon begins the
Jewish period, and the Senate will be out of session early in the
afternoon.

We're going to have several votes this morning, it appears, so
Senator Cohen, myself. Senator Kohl, and others will be running
back and forth from the committee, and we'll try to make this hear-
ing just as smooth as possible, notwithstanding those interruptions,
so we hope that you will understand that.

Also, upstairs in the Finance Committee, of which I'm a member,
we're holding our first hearing on NAFTA, and I will probably have
to go upstairs a time or two for that particular meeting. So this is
just one of those days where we're supposed to be several places
at once.

I want to give you a quote this morning to start our hearing off
and see if any of you might remember who said it before I tell you:

More than 20 million Americans are believed to have some form of hearing im-
pairment, ftoTO. total deafness to mild loss. Many can be helped immeasurably by
a hearing aid, many cannot be helped at all.

At the present time, according to estimates, most persons with a hearing impair-
ment first go to a hearing aid dealer for assistance. This places tremendous respon-
sibility on the dealer. He must be able to detect whether the hearing unpaired per-
son is a candidate for a hearing aid, on which the dealer makes a profit, or whetiier
he shovdd be referred to a physician, which may mean no business for the dealer.

(1)



The first question that we shall ask the hearing aid dealer is if he is truly quali-
fied. A regulation now being developed at the Food and Drug Administration ad-
dresses this critical issue.

With National health insurance on the horizon, if the FDA by regulation institu-
tionalizes the present hearing aid delivery system, it will Ukely be folded into any
health insurance program adopted by the Congress.

Those words are not mine. They were spoken nearly 20 years ago
by Senator Percy of Illinois when he chaired a Senate subcommit-
tee hearing on the hearing aid industry. Yet, his words are still rel-
evant as we look at todays hearing aid marketplace. Our ultimate
goal now, as it was then, is affordable, appropriate, accessible hear-
ing health care for all hearing impaired individuals.

Making the decision to purchase a hearing aid is not an easy one.
First, the individual must make the difficult admission that he or
she has a permanent physical impairment. Next, the individual
must come to terms with the notion of wearing an assistive device.
In the past, hearing aids were much larger and more cumbersome,
and there was a stigma attached to wearing them. Fortunately, the
example of many well-known public figures (among them former
President Ronald Reagan, Former Surgeon Greneral C. Everett
Koop, Arnold Palmer, and my good friend and mentor Senator
Claude Pepper, to name a few) and technological improvements
which have allowed for the down-sizing of hearing devices have
helped to ease concerns in this area.

I would like to mention that while preparing for this hearing I
was reminded of a story I heard in recent years of a time when
Senator Pepper, at the young age of 88, was being fitted for a new
hearing aid. When given the choice between the purchase of 5
years' worth of batteries for the device and a lifetime supply, he,
of course, chose the lifetime supply. I don't know whether that says
more about his confidence in the hearing device he was purchasing
or in his wonderful, positive outlook on life and living. He is an ex-
ample to us all.

With respect to securing hearing care, an individual seeking a
hearing aid must next have access to the care necessary to assess
hearing loss and the cause of loss, and to determine what steps can
be taken to assist the individual. Access, in this regard, is not al-
ways an easy matter, particularly in rural and underserved areas.
Additionally, it is important for an individual seeking care to have
confidence in the provider. Finally, the cost of the hearing device
prescribed for use must also be affordable. I'd like to take a few
moments to address each of these three areas of concern.

Confidence in the hearing care provider is critical. Hearing aids
can and do provide meaningful assistance to the hearing impaired.
Yet, there are some individuals that cannot be helped with hearing
aids. All nonmedical providers must be trained to recognize when
hearing aids are appropriate and when they are not. States must
do more to set minimum competency standards for licensing, and
they must enforce those standards. Unfortunately, we all hear hor-
ror stories about the unscrupulous sales practices of a few which
hurts consumer confidence. On a Federal level we must continue
to monitor advertising that induces consumers to purchase hearing
aids through in-home and mail order sales.

Today's hearing is not to condemn one group of hearing health
care providers in favor of another. Instead, we want to learn where



each member of the hearing health care team fits. The hearing spe-
cialist, audiologist, and otolaryngologist all have a role to play in
providing hearing health care.

Despite some of the more troubling marketplace issues we will
address today, I am truly amazed at the advances in hearing aids.
Hearing aid technology has greatly benefited from developments in
telecommunications and electronics over the past decade. In re-
sponse to public demand for cosmetic acceptability, microchip tech-
nology has led to miniaturization of hearing aids such that 80 per-
cent of the current market is for all-in-the-ear or canal aids. Pro-
grammable devices allow for tailoring to individual hearing loss
and needs. Some aids allow multiple frequency responses to be pro-
grammed and stored for use in different listening situations. And,
digital signal processing technology (DSP) can sense and cancel
acoustic feedback on high power aids.

But all of these advances are not without their costs. And hear-
ing assistance devices are, for the most part, an out-of-pocket ex-
pense. The fact underscores the importance of adequate consumer
protections in the hearing aid marketplace to ensure against a
drain on retired individuals' limited incomes.

Those of us who are fortunate enough to have normal hearing
may take it for granted. We don't realize how much hearing im-
pacts our daily lives. Imagine a world without sound or of only
hearing partial sounds. That is what the hard-of-hearing person ex-
periences.

As difficult as impaired hearing may be for any person, it is
compounded for elderly persons. Of the approximately 23.5 million
Americans that suffer hearing loss, more than 50 percent of them
are over the age of 65. The loss of hearing affects their independ-
ence and quality of life. For many older people, hearing impairment
prevents complete participation in everyday life. Simply trying to
understand what is being said around them can be a frustrating
experience. Beyond the inconvenience created by hearing loss,
hearing impairment can lead to paranoia and depression. For
many, purchase of a hearing aid can provide a lifeline to more en-
joyable, useful, independent lives, and increased purpose for living.

Today we will hear from a broad cross-section of groups and indi-
viduals interested in the delivery of hearing care in the United
States. I'm sure we all share the same commitment to ensuring the
public — and especially senior citizens who purchase more than half
of all hearing aids purchased in this country — can purchase these
important device with confidence. I want to thank all our witnesses
for coming to talk to us today and I look forward to hearing from
each of you.

[The prepared statements of Senators Shelby, Riegle, Simpson,
Durenberger, and Craig follow:]

Prepared Statement of Senator Richard Shelby

Mr. Chairman, I commend you for scheduling this hearing today to discuss otir
concerns regarding the marketing of hearing devices with particular emphasis on
advertising and sales practices. I am very pleased that the AARP has completed a
report on this issue which it plans to release at this Hearing and I look forward
to hearing and examining this information.

We are fortunate to have a distinguished panel of witnesses with us this morning
who will provide this Committee with some valuable insight into this problem. I re-
gret that some of you have been victims of questionable sales practices; however,



I am very hopeful that this Hearing will identify ways to help us to adequately pro-
tect you and other consumers from unscrupulous sales tactics.

Presently, almost 23.5 million Americans suffer from hearing loss, and 60 percent
of these individuals are Seniors. Because of the excessive costs of the devices, only
a little more than 3^2 million or 17 percent of the hearing impaired population wear
hearing aids. In addition, neither Medicare nor most insurance policies cover the
costs of hearing devices.

Although the price of hearing devices is of real concern to me, I find the lack of
safety regulations regarding the dispensing of hearing aids to be much more prob-
lematic. Because of the lack of regulation in the industry, there is considerable
abuse in the selling of hearing devices — people with little hearing loss are sold hear-
ing aids, and people who cannot be helped by hearing aids are sold hearing devices.

Both the Food and Drug Administration (FDA) and the Federal Trade Commis-
sion are responsible for regulating hearing aids. It appears, however, that even
though the FDA requires that consvuners he advised by the hearing aid dispenser
to take a doctor's examination before pvu-chasing a hearing device or sign a written
waiver of the medical exam, there may be misrepresentations of the waivers to the
buyers. The FDA has found the number of waivers to be too high. I am very pleased
that Commissioner Kessler of the FDA has agreed to testify before this Committee
today because I know that he will be able to enlighten us regarding this matter and
many other issues of concern.

Hearing aids can be dispensed by physicians, audiologists, or hearing aid dealers
and the laws vary for each group; consequently, there is sometimes considerable
confusion in the application of the regulations. Since the states are primarily re-
sponsible for regulating the hearing aid industry, I am hopeful that this Hearing
will thoroughly examine the manner in which State Licensing boards operate.

It is mv hope that the President's health care reform proposal will incoroorate
some of this Hearing's recommendations for the marketing of hearing aids. I want
to thank the witnesses for being with us today and I am eager to hear your views
on this issue.



Prepared Statement of Senator Don Riegle

Mr. Chairman, because this is my first hearing as a member of the Aging Com-
mittee, I wovild just like to say that I am delighted to be a member of this commit-
tee and look forward to worlung with Chairman Pryor and the other members of
this committee on the very important issues facing elderly Americans. Our senior
citizens have contributed a great deal to this country; they have made this nation
great. We have a responsibiTity to make sure that, in these volatUe times, we give
all consideration to tneir needs and concerns. This issue that we consider today —
consumer protection in the hearing aid market — is one that is of major concern to
many seniors and I commend the chairman for looking into this important issue.

I'd Uke to welcome Robin Holm, who is here from Livonia, Michigan on behalf of
the International Hearing Society. The Society, which is headquartered in Livonia,
represents hearing aid dispensers from all over the United States. I appreciate her
willingness to come and tell us about their work and concerns in this area.

I understand the concerns the Food and Drug Administration has raised about in-
suring that people with hearing impairments get proper care, and I also understand
that hearing aid dispensers play an important role in the hearing industry. I'm look-
ing forward to worlung together to develop a new policy that addresses the hearing
needs of people with hearing impairments and maintains an appropriate role for
hearing aid (fispensers.



Prepared Statement of Senator Alan K. Simpson

I commend my Mends and colleagues Senators Pryor and Cohen for holding to-
day's hearing on problems in the hearing aid industry. Senator Cohen's staff has
been particulariy involved in examining the issues surrounding hearing loss in older
Americans and the hearing aid industry. I want to applaud them for bringing this
issue to the attention of the Committee. I understand that the Committee has not
held a hearing on the hearing aid industry since the early 70's. We are long overdue
for another look into the industry, consumer concerns about the industry including
misleading advertising, and questionable sales practices of hearing aids, and Gov-
ernment regulation of the industry.

Hearing impairment can seriously affect the safety, and quality of life of older
Americans. Older American's purchase almost 65 percent of all hearing aids. How-
ever, hearing loss is a disability that we rarely pay attention to unless it affects us



personally or becomes an aggravation when someone we are close to can not hear
as well as they used to. It is interesting to note that only 17 percent of the hearing
impaired popiilation wears a hearing aid (3.8 million). The most hkely reason for
this is the lack of reimbursement under Medicare and private insurance policies for
hearing aids. Hearing aids can become a very expensive proposition for an older per-
son on a fixed income. That's why it is imperative to look into allegations of im-
proper sales practices and inadequate enforcement of standards in the sales of hear-
ing aids. However, we cannot lose sight of the fact that there are many legitimate
manufacturers and dispensers of hearing aids out there and only a few unethical
folks can ruin the reputation of an entire industry.

I am particularly concerned about the lack of enforcement by the FDA and State
governments in regulating the sales and marketing of hearing aids, and I look for-
ward to hearing testimony from Dr. David Kessler, Commissioner at the FDA. In
addition, I am interested in hearing from the AARP on their constuner satisfaction
survey and feedback they received from their request for letters on people's experi-
ences with their hearing aids.

1 look forward to hearing from todays witnesses and thank the Committee Chair-
men for holding this hearing today on this important topic.

Senator Simpson submitted questions for witnesses at Aging Committee hearing: i

Dr. Mildred Dkon, Vice President, AARP

Question. Am I correct in understanding that the AARP sells hearing aids through
its pharmacies?

Question. If so, can you tell me it people who bought hearing aids through the
AARP were any more or less satisfied than other respondents to your consiuner sur-
vey?

Question. In your written testimony, you recommended that a 30-day return pe-
riod should be required for the sale of all hearing aids. Do AARP pharmacies have
such a policy and, if so, do they make sure that customers are fiilly informed that
they have the option of returning the hearing aid within 30 days?

Question. What type of "hearing evaluation" shoiild a customer expect to receive
at an AARP pharmacy? Are these evaluations always performed oy a certified
audiologist — as you recommended in your testimony?

Question. When the AARP sisked its members to provide "consumer feedback" on
hearing aids in the September 1991 issue of AARP Bulletin, was this done in such
a way as to elicit responses fi:t)m all readers or only from those who were dissatis-
fied?

Question. Can you tell me anything about the nature of the responses the AARP
received fi:t)m my home state of Wyoming? Did the results vary significantly in dif-
ferent regions of the country?

Question. In your written testimony, you stated that only 3.78 million Americans
wear hearing aids, but that there are estimated to be 23.5 milUon Americans with
hearing loss. It seems to me that it would be very difficult to make such an esti-
mation unless these people have actually received hearing evaluations. How was the
figure of 23.5 million arrived at? Is it based on sound medical evidence or is it most-
ly speculation?

Dr. David Kessler, Commissioner, Food and Drug Administration

Question. It seems that the FDA has paid very little attention to the hearing aid
industry until the last year and a half. Now we have seven manufacturers who nave
received warnings from the FDA about their advertising claims. Why the sudden in-
terest? Are their advertising claims less truthful now tiian they were five or ten
years a^o? What has changed?

Question. Can you spell out precisely what you wovdd like the manufacturers to
demonstrate in clinical trials? What kind of data are you looking for?



Prepared Statement of Senator Dave Durenberger

Thank you, Mr. Chairman, for holding this hearing today on the hearing aid mar-
ketplace. Hearing aids are one of the most widely used assistive devices, and as
such, effect a large number of people, particularly the elderly. I welcome the oppor-
tuni^ to explore the concerns of consvuners, providers, the industry, and tJie FDA.

A very small percentage of people who need hearing aids actually have them. Out
of approximately 26 million Americans who suffer hearing loss, only 5 million have

iSeep. 215.



hearing aids. There are many reasons why people do not get hearing aids: vanity,
denial, cost, etc. I would hope that anything that we do would not erect more bar-
riers to obtaining hearing aids, given the fact that so few people who could be
helped by hearing aids actually have them. At the same time, we want to ensvire
that hearing aid devices are safe and appropriately dispensed, and that sales stand-
ards are met and properly enforced.

We must also consider this issue in a broader context. We are just beginning a
process of debating how our health care system ■wUl be reformed. Simultaneously,
States, providers, and payers are trying to design systems that will provide health
care services at lower costs, with an emphasis on prevention, access, and less spe-
cialized providers.

We need to be very aware of how changes in this industry will effect health care
reforms, costs, and ciirrent attempts by States to initiate change before broader
health reforms are imposed. Are we liiniting or expanding access to care? Are we
finding alternatives that will provide care at a lower cost? Are we preserving or im-
proving the quality of the services our current system provides, or losing it alto-
gether?

This is the context in which I believe we should examine this issue, and indeed,
any issue related to health care. Thank you, again, Mr. Chairman for this oppor-
tunity.



Prepared Statement of Senator Larry E. Craig

Mr. Chairman, thank you for conducting this hearing concerning the marketing
of hearing aid devices. I must admit that wnen this issue first came up, I was rather
svuprised because I had not been contacted by any Idahoans expressing concerns or
problems in this area. In fact, my experience has been just the opposite. On a per-



Online LibraryUnited States. Congress. Senate. Special CommitteeThe hearing aid marketplace : is the consumer adequately protected? : hearing before the Special Committee on Aging, United States Senate, One Hundred Third Congress, first session, Washington, DC, September 15, 1993 → online text (page 1 of 48)