Advisory: Hearing Aid Commissions

Advisory: Hearing Aid Commissions

The Ethical Practices Committee (EPC) occasionally receives inquiries regarding the ethics of accepting hearing aid commissions, including bonuses for hearing aid sales. The reason audiologists may question this type of arrangement may well be a direct result of the growing understanding of the ethics of quid pro quo relationships; i.e., receiving or accepting remuneration in exchange for a purchase, referral or recommendation, as might be indicated by receiving a direct commission for the sale of a hearing aid. Most of the available literature on the ethical practice of the profession of audiology discusses quid pro quo relationships with the manufacturing companies with whom audiologists interact, but there has been little published regarding similar relationships with employers or contractors of audiologic services.

Hearing aid commissions are used by some employers as a means of compensation, presumably intended to reward hard working employees or to motivate employees to be more productive. The subject of incentive compensation is complex and can be applied in various situations and by a variety of arrangements, thereby precluding a simple "yes or no" to address the issue. Audiologists should avoid arrangements with employers that provide for profit-sharing of revenue that results from the sale of hearing aids, as this may place an inappropriate influence on the audiologist to dispense more, or more expensive, hearing aids.

Underlying all healthcare practices is the bond of trust between providers and patients, which must be preserved, and the best interests of patients must have priority over the personal business interests of the provider. Incentive compensation, as a component of what an employee or contractor receives as a reward or to motivate one to increase productivity, is acceptable and encouraged in some situations. Incentive compensation packages can reward hard working employees and appropriately structured incentive plans can reward healthcare providers who, through efficient and effective use of time, help reduce the overall cost of healthcare. Potential problems arise and confusion may exist over business practices that involve incentive plans that provide for hearing aid commissions alone or reward unethical behavior.

Employee productivity is and should be measured in a variety of ways. Components of productivity (with which to determine employee compensation) may include the number of patients served, outcome measures that indicate that the patient’s needs were met, amount billed or collected for evaluations and follow-up, number of hearing aids prescribed (that can be linked to outcome measures), meeting employer goals such as team work or attitude, and others. It is recommended that incentive pay include multiple components of productivity and not be limited solely to the number of hearing aids fit, number of “high end” hearing aids fit, or the amount of revenue generated to the practice or the facility.

It is recommended that, when an employee is offered compensation that includes only hearing aid commissions, the employee audiologist renegotiate a compensation package to one that is more encompassing and which includes quality indicators and other measurable goals as described in the previous paragraph. Broadly structured compensation packages will help to relieve the employee of the potential influence of the quid pro quo relationship. Additionally, when developing a compensation package, the employer and employee should review the federal and state statutes, which regulate the legality of commissions in the healthcare arena. In some instances, the employee audiologist may wish to consult with legal counsel before signing contracts that stipulate hearing aid commissions as part of an overall compensation package.