A look back to January 1973…

January 1973 was a tumultuous time for the hearing industry. Well, okay, it was a tumultuous time for everyone: Nixon was inaugerated for his second term, the Vietnam War ended, the EEC/EU started, the Supreme Court decided Roe vs Wade, and the Miami Dolphins cruised through the Super Bowl to the only perfect season in NFL history.

But big things were happening in the world of hearing care as well. Here are some excerpts from 8 of 25 industry leaders who provided forward-looking commentary in the article “1973—A Challenge and an Opportunity” published in the January 1973 edition of The Hearing Dealer. The quotes are followed by an editorial perspective about this era that I hope will generate some discussion and commentary from interested readers.

Marjorie Skafte, editor and publisher, The Hearing Dealer: “The business outlook for 1973 is very good. Federal government official reports show a halt in the rapid growth of inflation which faced us at the beginning of 1972. The stock market still is fluctuating but has indicated a greater strength in the later months of 1972. The war in Vietnam is still with us but the peace talks in Paris still go on…The hearing aids of 1973 make it possible for the hearing aid dealers and consultants of the world to fit each partially hearing individual with an aid specifically designed for that person’s hearing loss…Cooperation between members of the [hearing healthcare team] will be one of the major determining factors [for success in 1973]. Just think what could be accomplished if the otologists, audiologists, manufacturers and suppliers, and the hearing aid dealers and consultants joined hands in a united effort to tell the story of the help available to those with impaired hearing! If all selfish interests were laid aside and each group on the team really concentrated on making those words, ‘the welfare of the hearing impaired is our primary interest,’ really true, then I believe the differences of opinion would quickly evaporate. Each discipline would then accept responsibility for their actions. There would then be no reason for government interference or the investigations reportedly designed to promote the welfare of the consumer.” [This quote is from Marj’s editorial; the remaining quotes are from the cited article above.]

Samuel Lybarger, president, Radioear, a unit of Esterline Corp: “Technology in the industry will provide significant improvements for the hearing aid user. An area of considerable interest will be new HR73 SamLybargertypes of microphones [Knowles had introduced the electret/FET microphone in 1972, and LTI, which would soon become Gennum, introduced the push-pull amplifier for these mics]. Another area may be the increasing use of AVC [automatic volume control] systems….To say that everything in the industry will go along smoothly in 1973 would be wishful thinking. The dealer has been under attack by some of the most malicious propaganda the industry has ever seen. The manufacturing sector, along with many other industries, is faced with totally new concepts at the federal level. These problems will be difficult, but I believe they will be solved. The health of our industry still depends on healthy relationships with medical, audiological, and other hearing oriented professions. The industry must continue its efforts to improve these relationships. A substantial majority of professionals recognize the important role the hearing aid dealer plays in fitting and delivery of hearing aids.”

HR73 HymanGoldberg

Hyman Goldberg, research director, Dyn-Aura Engineering Laboratories. “There seems to be an opportunity for expanding sales considerably because of this new market [people with 30-25 dBHL losses who would benefit from compression circuits]. Persons who have had small hearing losses falling into this category have been mostly unable to adapt to the hearing aids currently available and would welcome the compression models with open arms…These people who are candidates for compression amplification wouldn’t normally purchase a hearing aid. However, it is my feeling that this market is in addition to the already existing market…”

Robert E. Winslow, president, Dahlberg Electronics Inc: “Suddenly dealers who HR73 RobertWinslowhad grown accustomed to a large share of their business coming to them as ‘referrals’ are finding they have to go back to their basic function as a commercial evangelist in bringing the benefits of modern hearing aid technology to the hearing handicapped. And they find the market hasn’t changed much. The major burden of aggressively promoting the concept of a hearing aid as an essential element in hearing rehabilitation continues to be borne by the hearing aid industry.  In spite of all the high flown rhetoric that has been launched in a conscious campaign to confuse the public and impugn the industry, industry sales continue to grow. Why? Because collectively we are doing more good for more hearing handicapped than the combined forces of our detractors.”

Richard J. Scott, MA, division manager, Siemens Corp: “We must now take the responsibility to establish training courses which will bring us to the level of optometrist. A hearing aid professional school could be set up through one of the established universities and award a degree in whatever we decide to call it. With the establishment of such a college, we would no longer have the problem of recruiting new people into this industry. In addition, recognition would follow to enhance our professional image and sales. This would be an important step to elimination of other groups trying to usurp our position. The industry, for all practical purposes, is about 30 years old. It is time to become responsible, responsible for our future, our actions and to the population we serve.”

Richard T. Burger, president, Qualitone: “Dealers’ knowledge and training in pure tone, air and bone conduction with proper masking, combined with full speech, aided and unaided testing, will be an absolute necessity to avoid unfavorable publicity and to establish dealer expertise. Some dealers will have to upgrade their test equipment with increased emphasis on twin channel audiometers that are so important in establishing the advantage of binaural versus monaural fittings. The day of dispensing hearing aids with anything less is over, and dealers can become well qualified for this responsible function. The increased recognition of the value of CROS and BICROS fittings, I think, will also contribute to increased sales in 1973. Hearing aid instrumentation which enables the user to adjust frequency response to different listening situations will become more and more in demand, both from the user’s point of view and in minimizing dealer inventory. I believe that as licensing and strict codes of ethics are adhered to, we shall see a build-up of more referral business. I expect that in 1973 we shall see not the ultimate, but further meetings with otologists, audiologists and hearing aid dealers for definition of roles. 1972 was a year of progress in product improvement and sales. I expect 1973 to be another banner year.”

Robert G. Errico, marketing manager, Mallory Battery Co: “Currently some observers feel that hearing aids will be included in the federal Medicare program; however, others believe inclusion  will not be in the near future. What priority and action this Congress gives to include hearing aids under Medicare will also affect the hearing aid industry in 1973…As in 1972, continued government involvement in the areas of the Occupational Safety and Hazard Act will create an increase in awareness of hearing problems…”

James H. Johnson, president, Zenith Hearing Instrument Corp: “…I cannot look to 1973 without  seeing the shadows of late 1972 obscuring the scene. As long as most of our energy must be devoted to covering past actions, we have little left to push ahead. The Industry Enhancement Program will not be our Savior, it will only be as productive as the support [we] all give it. The program will be doomed to failure if it is required to put out the fires of a few. It can be enormously successful if all, dealer and manufacturer alike, will give it their full support through the professional operation of their respective businesses.”

Now and January 1973

There are some similarities, but far more differences, between the US hearing aid market of 1973 and 2013. Like today, the hearing industry of the early 1970s was experiencing dramatic changes in its distribution system. By 1973, dispensers were moving rapidly away from at-home dispensing (about 38% of dispensers) to in-office dispensing (58% of dispensers, with 5% split between home and office). The clinical referral system, in which audiologists identified a hearing loss then referred patients to dispensers, was gradually leading to the breakdown of the commercial hearing aid franchise (single hearing aid line) system.  As multi-line dispensing became more popular, wholesale distributors began to flourish. Additionally, some of the first “renegade audiologists” started dispensing centers during the late 60s and early 70s against ASHA’s insistence that this constituted unethical behavior (eg, see the October 1994 HR article, “Dispensing Audiologist—They Once Walked a Lonely Road” about the hearing care practices started by Jim Curran, John Schuneman, Mel Sorkowitz, and Otis Whitcomb).

Today, well over 90% of US hearing aids are dispensed from an office or retail setting, with about 5-10% coming from direct mail and the Internet. But, relative to franchises, some industry experts have lamented the notable decline in numbers of independent dispensing offices that are not owned by or otherwise tied to a chain network or hearing aid manufacturer. In some respects, we have gone “back to the future” in that—once VA dispensing activity (20% of all hearing aids dispensed) and online sales are taken out of the equation—true multi-line independents probably hold only a slight (eg, 60/40) edge in terms of the number of distribution outlets.  Likewise, we still have the same problem as that pointed out by Siemens’ Richard Scott: not enough professionals are entering the field.

Perhaps the most important difference between today and the early 1970s is in government and consumer relations. The 1970s heralded a new age of consumer activism, and some hearing aid distribution tactics—particularly high-pressure door-to-door and hotel room sales—increasingly caught the gaze of watchdog groups and government agencies. Additionally, in 1972, the US Federal Trade Commission (FTC) issued a complaint against five manufacturers regarding imposed territorial restrictions, exclusive dealing, and anti-competitive practices. It also issued a 3-day consumer “cooling off period” for door-to-door hearing aid sales.

The Retired Professional Action Group, supported by Ralph Nader, also undertook the Hearing Disability Study in 1972. However, in February 1973, the group’s director, retired diplomat Joseph E. Wiedenmayer, resigned in protest over the report’s preparation. The resulting September 1973 study—coordinated by Elma Griesel with assistance from the NYC Gray Panthers—was titled Paying Through the Ear. It soon became known by the hearing industry as “The Nader Report.” Among its contentions were that hearing aid manufacturers and dispensers maintained artificially high prices, and it recommended that consumers get a medical examination prior to obtaining hearing aids. The Associated Press quoted Wiedenmayer as stating, “[The final report] seems to confirm what I was afraid of. It would seem that such a report could—inadvertently or otherwise—only confuse or frighten the hard of hearing.”

Much of the industry’s efforts throughout the 1970s would be consumed by fending off the assaults waged by people like Nader and Senators Percy and Church, as well as investigations by HEW, FDA, and FTC. Wiedenmayer’s words proved prophetic: industry sales plummeted 20%, from 511,000 units in 1970 to 410,000 in 1977.

Even prior to 1973—before the real flood of negative publicity hit the media—the Hearing Aid Industry Conference (HAIC, the predecessor of the Hearing Industries Assn) and the National Hearing Aid Society (NHAS, the predecessor of the International Hearing Society) were taking steps to improve technical training and professional conduct. For example, in 1972 a joint effort by NHAS/HAIC sponsored 20 educational workshops, and in 1973 the HAIC Industry Enhancement Program was initiated. But ultimately it took over a decade to get through this period of intense government interference—including numerous highly publicized government proceedings, 203 witnesses, 6,000 pages of documents, and 4,000 pages of comments. It wasn’t until 1985 that the FTC finally recommended its 1975 Proposed Trade Regulation Rule be terminated. All of this contributed to making the 1970s a tumultuous divisive period of raw feelings, high-profile accusations, and what many viewed as self-destructive “turf wars” between hearing aid dispensers, audiologists, and ENTs.

On the more positive side of regulation, OSHA was formed in December 1970, and the agency issued its first hearing-related criteria document in 1972—and much debate ensued regarding TWA dB limits and “feasibility” issues relating to the implementation of noise controls by industries (this is another subject for another time).  But the bottom line is the areas of industrial hearing conservation and environmental noise were more firmly placed on the “regulatory map.”

There were several technical innovations in microphones (including directional mics) and amplifiers during the early 1970s, as evidenced by some of the above comments. There was also a gradual  movement away from a reliance on word-lists for the selection of hearing aids (and, to a lesser extent,  the Carhart fitting method) to the prescriptive fitting era using the Lybarger Half-Gain Rule, Watson & Knutson, Berger, Pascoe, Libby, etc, methods. In terms of hearing aid styles, BTEs constituted about 65% of the market, with eyeglass (16%), body (10%), and ITE (8%) aids making up the rest.

In 2012, BTEs made up 71% of the market, with ITEs (13%), ITCs (9%), and CICs (7%) making up the rest of the devices sold.  Although I could not find statistics on the binaural/monaural fitting rate in 1973, my guess is that they were in the 20%/80% range (the binaural fitting rate in 1979 was 27%). Today, the binaural/monaural fitting rate is almost exactly reversed: 80%/20% favoring binaural.

The comments of Robert Errico about Medicare were representative of other industry leaders at the time. I think these leaders might be shocked that, in 2012, Medicare still does not cover the cost of hearing aids or routine hearing exams. They all seemed to suggest that coverage by Medicare was an inevitability.

Even if you’re a romantic or prone to nostalgia, you wouldn’t want to return to the dispensing world of the 1970s. However, it was a time of tremendous change and reform, both in terms of technology and in the professions. The lessons of this decade, as well as the debts and sacrifices paid by those professionals who lived through it, should be burned into our industry’s collective consciousness.

What do you think? Chime in by emailing: [email protected]