The negative impact of hearing loss on communication abilities, quality of life (QoL), social participation, and overall well-being is well documented (National Academies of Sciences, Engineering, and Medicine, 2016). Audiological rehabilitation (AR) provides a holistic approach to lessening the impact of hearing loss and improving the health-related quality of life (HRQoL) through sensory management, instruction, perceptual training, and counseling (Boothroyd, 2007).
From a public policy standpoint, measuring the benefits of treatment intervention on improving HRQoL, along with the costs to provide needed audiology technology and services, is essential to the audiology profession and the patients we serve. Why? Because health economics provides outcomes research to governments, payers, health ministries, clinicians, and patients, who then are able to adequately compare and select among the available intervention options.
The decision to select a given intervention is guided by assessing the costs associated with the treatment intervention, the benefits of the treatment intervention, and the way these factors compare to all illnesses, diseases, and injuries within health care. In this article, the reader is provided with an overview of the costs and benefits associated with hearing aids and rehabilitation services in adults.
Defining Health, QoL, and HRQoL
There is no consensus among scholars on the definition of the terms discussed in this section. The World Health Organization, for example, defines health as “a state of complete physical, mental, and social well-being and not just in the absence of a disease or infirmity” (WHO, 1948). Key aspects of disagreement among scholars with respect to the WHO definition are the inclusion of “social well-being” (Torrance, 1987) and the emphasis on “the absence of disease” (Patrick et al, 1982).
The significance of QoL in health care became apparent in the 1960s when medical interventions extended the length of life for individuals. Consequently, traditional measures of morbidity, biological functioning, and death rates were insufficient to quantify changes in population health (Bergner, 1985).
Many approaches to defining QoL exist, based on the dimensions of human needs, subjective well-being, social interactions, psychological status, physical status, functional abilities, expectations, and economic status (Post, 2014). In general, QoL should be viewed as an individual’s subjective perception about the way they feel, behave, function, and interact in their daily life at a given point in time.
HRQoL can be defined broadly as a multi-dimensional tool that assesses the physical, psychological, functional, and social domains related to a person’s perception of QoL affected by health status (Wilson and Cleary, 1995). To quantify health status, HRQoL uses the estimate of the quality-adjusted life year (QALY) as an outcome measurement for the economic evaluation of health technologies.
Health technology is an all-encompassing term for an intervention that includes diagnostic and treatment interventions such as pharmaceuticals, surgeries, therapies, diagnostic imaging, infection control, and hearing aids. The QALY is a measure of health outcome determined by combining the quality of life (subjective measure) and length of life (objective measure) provided by an intervention into a single index number ranging from 0.0 (death) to 1.0 (perfect health). The QALY can also be used to compare the cost-effectiveness of a given intervention, with the outcome reported as cost/QALY.
What Is Economic Evaluation?
Economics is the study of decision through the examination of incentive and consequences and the measure of service production, delivery, and consumption. Economic evaluation, therefore, is the understanding and use of economic evidence in decision-making in generating outcomes. These outcomes provide legislators and other professionals with the ability to identify, measure, and compare activities with the necessary impact, scalability, and sustainability to optimize individual and population health.
Categories of Economic Evaluation and Audiological Rehabilitation Outcomes
There are two categories of economic evaluation: partial and full.
Partial Economic Evaluations
Partial economic evaluations consider costs or consequences of a disease or intervention, but do not involve a comparison between an alternative intervention or relate costs to outcomes. There are two types of partial economic evaluations: cost of illness and cost analysis.
Cost-of-illness evaluations estimate the economic burden or total costs attributable to a disease. Huddle et al (2017), for example, found that hearing loss results in a loss of productivity in the United States ranging between $1.8 and $194 billion, while medical costs range between $3.3 and $12.8 billion. More recently, Ruberg (2019) estimated that disabling hearing loss (i.e., thresholds > 35 dB HL) equates to lost annual productivity of $9,100 per American and $9,260 per European.
A cost analysis is a systematic and itemized breakdown of the fixed and variable direct (e.g., labor, materials) and indirect (e.g., supplies, utilities, equipment) costs associated with a treatment intervention. To determine how to itemize direct and indirect clinic-operation costs systematically, the reader is referred to Sjoblad and Abel (2016). A thorough cost analysis is a requisite before proceeding with any of the economic evaluations listed in the next section.
Full Economic Evaluations
Full economic evaluations provide valid information on the efficiency of an intervention by comparing the costs and the benefits of two or more interventions. There are three types of full economic evaluations: cost-benefit analysis, cost-effectiveness analysis, and cost-utility analysis.
A cost-benefit analysis (CBA) is considered the gold standard of economic evaluation because all costs and benefits are quantified using a common metric, such as dollars, per QALY. Willink et al (2019) found that hearing-care services for older adults with hearing aids reduced annual Medicare spending by $2,513 per individual when compared to a similar group of aided listeners who did not use the same services.
Brent (2019) employed a CBA to estimate the direct and indirect utility benefits of hearing aids on reducing dementia symptoms. The findings revealed that hearing aids provided a benefit over costs by a ratio of 30:1. In addition, the reduction in symptomatology from hearing aid use alone was enough to cover the retail cost of hearing aids.
In Australia, Hogan and colleagues (2020) assessed the estimate of non-device usage and the costs associated with the existing service delivery model versus a proposed service model grounded in rehabilitation. The authors found that the provision of rehabilitation services—either in addition to or instead of hearing aids—could save an estimated 62 to 81 percent of publicly funded dollars.
Willingness to pay is another approach consistent with CBA. Here, an individual or group determines how much they are willing to pay (WTP) for the benefits associated with a technology.
Chisolm and Abrams (2001), for instance, examined how much Veterans were WTP for their hearing aids as a function of the benefit they received from the Abbreviated Profile for Hearing Aid Benefit (APHAB) (Cox and Alexander, 1995). The results revealed that the average Veteran, who receives hearings aids for free, was WTP $203.30 with no measurable APHAB global benefit and an additional $22.06 for each point increase in APHAB global benefit.
A cost-effectiveness analysis (CEA) compares improvement by dollars spent between varying interventions (e.g., without/with hearing aids) for the same health outcome (e.g., the QALY).
Chao and Chen (2008) found hearing aids to be a cost-effective treatment for adults ages 50 to 80 in Taiwan, when compared to the non-adoption of hearing aids, at an estimated $13,615/QALY for men and $9,702/QALY for women. Similarly, Joore and colleagues (2003) found that the cost-effectiveness of hearing aid fittings compared to the non-adoption of this technology in the Netherlands yielded an estimate of €15,807/QALY. Regrettably, the individual findings from Chao and Chen (2008) and Joore et al (2003) failed to meet the minimum threshold of $20,000 and €16,000 for the consideration of insurance coverage and reimbursement in their respective countries.
A cost-utility analysis (CUA) is a subtype of CEA that compares the costs of different interventions with their outcomes, measured in utility-based units. Few studies have used this economic approach in the adult hearing aid literature.
Abrams and colleagues (2002) conducted a CUA comparing hearing aid use alone (HA) to hearing aid use with audiological rehabilitation (HA + AR) in the Veteran population. Pre- and post-treatment effects were measured using an HRQoL assessment tool. The results revealed a cost/QALY of $60.00 for HA and $31.91 for HA + AR, indicating that the latter was the more cost-effective intervention. (A review of HRQoL assessment tools can be found in Abrams et al (2005) and Dillon (2012).)
To date, the literature clearly conveys the economic burden of hearing loss. In addition, there is a small pool of evidence that demonstrates the reduced costs and increased benefits associated with improving HRQoL through technology and audiological rehabilitation services.
There is a marked need for increased scholarship in the area of health economics. This information could help the audiology profession to increase its footprint in the health-care arena, as well as lead to an increase in federally subsidized health-care dollars through public-health venues.
In time, the collective evidence from increased scholarly work will, presumably, provide the profession with a rational argument regarding the allocation of public monies toward audiological rehabilitation.