KEY FACTS FROM WHO (March 2020)
Around 466 million people worldwide have disabling hearing loss. It is estimated that by 2050 over 900 million people will have disabling hearing loss. 1.1 billion young people are at risk of hearing loss due to exposure to noise in recreational settings.
The Oculaudio hearing enhancement concept targets the European and North American markets, representing around 70% of the global market volume.
Substansial growth
Both markets expect solid and stable underlying growth over the next two decades, driven by a rapidly aging population mainly due to the baby boomer generation on both continents.
The global market for hearing aids is expected to undergo significant changes in the coming years, including new legislation in the United States (OTC Hearing Aid Legislation), increased pressure from relevant interest organizations and industry associations, and increased focus from health authorities worldwide as a result of the enormous socio-economic the consequences of untreated hearing loss in the population.
Competition from new players and a consumer centred democratisation of the hearing aid market is expected to disrupt the entire industry over the coming years. A disruption that will mostly benefit the consumer but also have a positive effect on uptake rates in the mild-to-moderate segment.
The associated mounting social economic cost on society from the combination of untreated hearing loss and an aging population has caused serious concerns from stakeholders, relevant agencies, interest groups, etc. Pressure is increasing on authorities and policy makers to make hearing aids more accessible for consumers, and to open the market to new technologies – which in turn means opening for new players in the industry.
The rapidly shifting landscape and a largely underserved market with stable underlying growth, represent a substantial potential for new players with new products and technologies.
In general the European market for hearing devices is more diverse than the US market, in particular in the retail segment.
Another key difference is that hearing care is generally freely accessible and, depending on country, partly or fully covered by public health services.
The more diverse retail segment combined with established public reimbursement schemes across Europe, consumer access to hearing services and solutions is comparatively high compared to US and the rest of the world.
Management of public hearing healthcare in Europe can broadly be divided in two different models; the “state organised model” (Norway, Denmark, UK) where hearing care is basically free of charge, but the user have little or no freedom of choice, and the “free market model” (Germany, Switzerland, France, Italy), where the health care system refunds hearing aids with a flat fee and give the user full freedom of choice.
Research show that users under the “free market model” use their hearing aids more actively than users under the “state organised model” and are generally more satisfied – even when they have to pay a contribution over the flat fee public reimbursement.
It seems to be consensus among stakeholders that increased freedom of choice for users is an important element in increasing hearing aid uptake. This consumer centric approach is one of the drivers behind the growing private market across Europe, also in countries operating under the “state organised model”.
The US hearing aid market is highly rigid and heavily regulated compared to the European market.
For example, a Medicare law from 1965 specifically prohibits the national insurance program from paying for hearing aids, and consequently neither will most private health insurances.
Basically this means that the entire hearing aid market in the US is private since the user has to pay the entire cost of hearing healthcare personally. However, this does not mean that the user has full freedom of choice. On the contrary, the user has very little freedom of choice.
US consumers typically have to purchase a package that bundles their audiology report with a manufacturer’s limited selection of devices.
The Over-the-Counter Hearing Aid Act of 2017 is opening up for a radical change in the US market, which alone has the potential to disrupt the entire hearing aid industry. Furthermore, there is also pressure on policy makers to include hearing aids in Medicare coverage, but this will most likely take some time still.
Regulations for the new OTC category is still in the making, but it is expected that users suffering from mild-to-moderate hearing loss will be allowed close to full freedom of choice in services and devices.
The current development in the US market represent a huge opportunity for new players, players with new products and solutions with different and better value proposition than the conventional hearing aid manufactures so far have been able to offer.