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Do We or Do We Not? That Is The Question—-


Do We or Do We Not? That Is The Question—-

Third Party Hearing aid Providers

The one thing that I have noticed recently is that more and more 3rd party businesses are popping up all over the country.  Groups like Tru-Hearing, Amplifon/Hear PO, Siemens/Hear.com and on and on.  Some of these are owned by the manufacturers and others are owned be groups indirectly related to manufacturers.

I see that many independent Audiology clinics are buying into delivering the hearing aids for these Third Party Suppliers.  Being reimbursed for as low as $200-300 delivery fees is such a joke.  In this model, patients would just call a local Audiologist or clinic and follow evaluation and prescription procedures, with the implication that the Audiologist is just some technician who “hands off” equipment. That’s outrageous! Why would any Audiologist give away thousands of dollars to someone who is sitting with a headset at a call center?  Competition? Desperation?  Stupidity?

If you look at the money paid for the service, it’s crazy for any audiology clinic to add these patients.

I don’t know about all clinics are reacting to this, but I believe that this is an effort propagated by the manufacturers to increase their profit margin. This has created a bad environment which will pressure many audiologists using the standard practice model to sell or go bankrupt. As the economic pressure increases, the manufacturers then are in a position to buy your practice with the claim that they are your “friends”.

Let just review the pros and cons of the third party providers—

The Pros:

  1. The Clinic gets a referral (Gets to fill any empty slots in schedule) (4 hours Total)

  2. Clinic schedules 1 hour and thirty minutes for a hearing test and evaluation

  3. Clinic reschedules a delivery appointment for 1 hour

  4. Clinic has responsibility for 3 more follow-ups at least 1 hour and thirty minutes more time

  5. The Clinic bills for fitting, $300 to $600 per aid (That’s a Low Reimbursement)*

  6. The Clinic waits for payment, usually gets paid sixty to 90 days later (Really)

  7. The Patients get a “fair price”, which may or may not fair, depending upon delivery cost (the only thing that they can offer is cheapness!)

  8. Clients get minimal results

 

The Cons:

  1. The Clinic has scheduled time that normally reimbursements are higher with this low-paying appointment (a loss of revenue)

  2. The Clinic and Audiologist has all the liability but not getting paid for it

  3. The Customer values cheap equipment, sometimes without placing value on the quality of equipment

  4. The Customer receives compromised equipment and results.

  5. This scheme does not add to “units sold through your accounts” and cannot effect the leverage for pricing to the provider.

  6. The Clinic is perceived as source for cheap products, rather than a professional clinic.

  7. The Clinic is forced to charge all aspects of services, a concept often hard for patients to understand

  8. The maximum revenue for 4 hours of work would be $75, per hour, up to $300

  9. The Third party seller makes the profits in excess of the basic equipment cost, with only a small service fee for the delivery. They are still getting their hearing aids built for less than $100.00, but selling them for more than $1000.00.

  10. The clinical procedure is so undervalued and hearing evaluation is so deflated that many Third Party groups require little or no payment for the audiological evaluation.

 

Private Audiology clinics will not survive long term in this business environment because they are making monumental poor decisions regarding third-party suppliers.  I manage a small Audiology clinic in Austin, Texas, but I have enough business understanding to realize what’s happening.

All providers should agree to drop these predators!

Larry Bailey 11/11/2015

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