As mentioned in a previous post, the debate over bundling versus unbundling in hearing aid pricing rages on. Although the unbundled method of pricing is seen in only a minority of practices, the issue has come front and center because the cost of hearing healthcare is seen as being too expensive, even by our government.
The most common method of pricing currently is in a “bundled” or “packaged” format, where fees for the hearing aids and those services associated with choosing, fitting, adjusting and servicing the hearing aids are billed in a single charge.
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Example of a bundled model of pricing:
Premier hearing aid technology $5990
Most insurance companies utilize this method. Also, remember that just because a service is associated with a V code doesn’t mean that an insurance company will reimburse for that service unless the patient has hearing aid coverage in their policy.
In an unbundled model, fees for the hearing aids and all associated services are billed separately, i.e the cost of the hearing aid(s) is separate from the cost of the services provided. Many feel that unbundling offers professionals the chance to provide transparency regarding fees and services associated with the hearing aids. In an unbundled model, the patient pays less upfront for the hearing aids and the services to fit the hearing aids and all subsequent appointments are fee-for-service.
Example of an unbundled model of pricing:
Premier hearing aid technology $ 2995
Hearing aid evaluation $ 195
Fitting and one follow up visit $ 595
Investment in better hearing $ 3785
One caution – If an established business has been utilizing a bundled form of pricing, gross revenue will suffer in the first couple of years because the cost for services won’t be collected up front but should be realized in subsequent years.
There are many ways to incorporate itemization into a pricing strategy. You could choose to present a fee for the device(s) and present a separate fee for the associated professional services or some colleagues present a fee for the hearing aids and then the patient has a choice of different service package options. In this model, the professional is still collecting the fees for the devices and the associated services up front but the fees are itemized so it is easier for a patient to see what they are paying for.
An example of an itemized billing:
Premier Technology Hearing aids $2995
Premier Service Package included during three year warranty period
Fitting and one follow up visit $595
One repair per year for years two and three $360
Annual evaluations each year 3@135 $405
Three cleanings per year 9 @ $45 $405
Batteries for three years $480
Wax management twice a year 6 @ $50 $300
Reprogramming once a year 3 @ $150 $450
Value of Service Package $2995
Investment in Better Hearing $5990
In an itemized billing, revenue is still collected up front for both the hearing aids and services.
Creating a fee structure that separates the cost of the hearing aid(s) from the services associated with the evaluation, fitting, orientation, delivery, counseling, and long-term care and management of these devices provides the opportunity to highlight the importance of our professional services.
So what method is best?
I don’t have the answer to that question, but I would say that I am going towards an itemized billing so patients can see what they are paying for. I have tried the unbundled model but what I found is that patients did not return for regular visits once they had to pay for them. However, the clinic at UNC Chapel Hill has been very successful with the unbundled model of pricing.
As usual, my advice is to measure and monitor HELP rates to see what is working with YOUR patients and the costs for services have to based upon the cost of your time to the business. I have moved to an itemized pricing structure in my practice. In these changing times, it may well take a combination of methods to succeed.
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