The Future of Independent Practice in Audiology

By Gregory Frazer

This article is a part of the July/August 2017, Volume 29, Number 4, Audiology Today issue.

There was a time when audiologists thought that they owned the hearing aid marketplace. Our growing private offices and our new AuD degrees would be the solution to the public’s malaise and lack of appreciation for better hearing. Bam! What happened? The traditional audiology scope of hearing aid dispensing finds itself the victim of a number of unforeseeable and uncontrollable changes that we did not anticipate, and in fact, we stood by blindly watching the tsunami wave arrive. Obviously, we didn’t see, or understand, the rampant growth of the converging forces chipping away at our position as the self-stated “owners of hearing health care.”

I deem the current unraveling hearing health-care delivery system as a serious problem for audiologists. I further believe the survival of the profession is at stake here.

…Academy Founder and Past President
Jerry Northern, PhD (2014).

In the same article, Dr. Staab (2015) reported statistics from Wall Street Analyst firm Sanford C. Bernstein, that independent practitioners who used to sell almost all hearing aids now only sell 39 percent of hearing aids. Bernstein research-analyst Lisa Bedell Clive sums up Wall Street’s view of the state of the independent practice of audiology by stating, “The market is moving away from independent retail, with growth in chain retail and manufacturer forward integration.” David Smriga, MA (2016) estimated that independent practitioners only sell 15 percent of all hearing aids now. No matter which estimate is more accurate, it is crystal clear that independent practice is on the decline and facing certain extinction.

A recent Letter-to-the-Editor by James Jerger, PhD (2016), offers our profession some thought-provoking suggestions. In reference to Dr. Barry Freeman’s opinion that, “Audiology has become too focused on product sales…products should not be the center of the audiology universe. We need to go back to our historical roots (Shaw 2016).”

Dr. Jerger states, “I am suggesting that for private practice to survive, there must be a conscious effort to broaden its base to include a full array of audiological services to the public, in order to become less dependent on hearing aid sales.”

Dr. Brian Taylor (Shaw, 2016) says that the level of interconnection between the clinical practice and the device industry is virtually unique to audiology. Dr. Jerger says, “Dr. Brian Taylor makes the point well,” when he states, “When you compare it with dentistry, vision care, and MD-driven specialties, I think hearing care is pretty unusual in how much it is driven by manufacturers and devices.”

However, if you look at dentistry, 80 percent of their income is driven by procedures utilizing products (ADA, 2014). Most dentists buy the majority of their products through one distributor, which is like of a group purchasing organization (GPO). In an ENT practice, 60–70 percent of their income is driven by procedures utilizing products primarily from one distributor. (Personal communication with many ENTs and AAO–HNS since AAO–HNS said they did not have this data.)

Optometry practices derive 61 percent of their revenue from product sales, 22 percent from eye exams and 17 percent from medical care (Management Business Academy, 2015), and Luxottica controls 80 percent of the major brands of eyeglasses in the industry. The takeaway message is that most medical professions are dependent on products for the majority of their income, and most medical professionals purchase their products primarily through one distributor to get the lowest cost.