At our recent Business Partner Summit, Keith Lewis, VP of Business Development, delivered a presentation on current industry trends and how they impact you as a private practice owner.
With the hearing healthcare market undergoing some fundamental structural changes, there are some threats and opportunities for private practice. There are also some myths to be dispelled.
MARKET TRENDS
The Department of Veterans Affairs has seen their hearing aid dispensing increase substantially, due to lifting eligibility restrictions and has grown on a compounded bases by 8.6%. That means the non-government market has not faired as well (3.3% growth from 2003 to 2011).
The VA has grown disproportionately fast. This is a function of changing eligibility rules allowing veterans to receive hearing aids regardless of how the hearing loss was caused.
The net impact of the VA growth appears to have been proportionate in its impact on National Retail and Open Market Channels. The retail channel is not driving market growth. If anything, retailers are battling each other for market share.
MYTHS
The Baby Boomers Are Coming!
While the baby boomers are “coming of age”, they’re not going to represent a real impact on hearing aid sales because they’re still relatively young. The average age of a new hearing aid user is 69.4 and adoption rates are not increasing.
Those Darn Ear Buds!
The advent of “ear buds” is also thought to be impacting the market, but there is no real evidence to support this. High Frequency hearing loss is a progressive condition and it would take a considerably long period of time to manifest itself in hearing aid sales.
The Internet is Siphoning Off Patients
This is completely unfounded. Internet sales, including Hearing Planet, represent only 1% of the entire market.
THREATS
The real threat for private practices lies in patient satisfaction, which has not increased at all over the past ten years. Patients are not getting the most out of their hearing aids.
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62% of all fittings involve the best fit button.
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35% of fittings utilize Validate and Verify Protocol
A real opportunity exists for private practice owners to increase patient satisfaction by focusing more on patient lifestyle needs and using verification and validation during fitting to ensure the best fit possible.
CONCLUSIONS
- The VA has grown on the backs of the non-government market and is expected to slightly outpace the non-government market moving forward
- National retailers are fighting one another for market share with little impact on the independent “open” market
- There is nothing that will fuel market growth in the short term
Market Share is the driving factor to GNR Revenue Growth and Business Development is an important means to realize this.