Important Legislative Issue: Tax Credits for Hearing Aids

Important Legislative Issue: Tax Credits for Hearing Aids

http://www.hearingaidtaxcredit.org/

Hearing Aid Assistance Tax Credit Act

What would the Hearing Aid Assistance Tax Credit Act do?

* Provide a tax credit towards the purchase of each hearing aid of up
to $500 per hearing aid, available once every 5 years. It would be
available to 1) individuals age 55 and over, or 2) those purchasing a
hearing aid for a dependent.

Why is this special tax treatment needed for hearing aids?

* Hearing aids are not covered under Medicare, or under the vast
majority of state- mandated benefits. In fact, 71.4% of hearing aid
purchases involve no third party payment, which places the entire
burden of the purchase on the consumer.

* While 95% of individuals with hearing loss could benefit from
hearing aids, only 23% (7.38 million Americans) currently use them,
according to the most recent ‘MarkeTrak’ report, the largest national
consumer survey on hearing loss in America, conducted by the Better
Hearing Institute.

* Thirty-six percent of individuals with hearing loss have incomes of
less than $30,000 per year, and household incomes of individuals with
untreated hearing loss are usually much lower than those of
non-hearing impaired counterparts.

* Two out of three adults with hearing loss cite financial
constraints as a core reason they do not use hearing aids.

* The average cost for a hearing aid in 2004 was $1,800, including
fitting, evaluation, and post-fitting treatment. Seventy percent of
individuals with hearing loss require two devices, increasing average
out of pocket expenses to $3,600.

What is the extent of the problem with hearing loss in the U.S.?

* Hearing loss is among the most prevalent birth defects in America,
affecting 3 infants per 1,000 births. 1.4 million children under 18
have a hearing loss.

* For adults, hearing loss usually occurs gradually but increases
dramatically with age. 10 million older Americans have age-related
hearing loss.

* One of the goals of “Healthy People 2010,” an HHS-led program, is
to “increase the number of deaf or hard-of-hearing people who use
adaptive devices, such as hearing aids.” The Hearing Aid Tax Credit is
the most cost-effective means to accomplish this goal.

What is the cost impact of untreated hearing loss?

* Children who do not receive early intervention cost schools an
additional $420,000 and face overall lifetime costs of $1 million in
special education, lost wages, and health complications, according to
a 1995 study published in the International Journal of Pediatric
Otorhinolaryngology. The U.S. Department of Education indicates that,
in 2002 alone, over 70,000 students, ages 6-21, received special
education services, due to their hearing loss.

* A 2005 survey to 80,000 households by the Better Hearing Institute
reviewed income levels of 43,000 adult heads of household with and
without hearing loss controlling for degree of hearing loss, age and
other demographic variables. In a study titled “The Impact of
Untreated Hearing Loss on Household Income” they showed that untreated
hearing loss results in a loss of income per household of up to
$12,000 per year, depending on degree of hearing loss. For the 24
million Americans with untreated hearing loss, this equates to $122
billion in lost income, due to underperformance on the job. This
translates into a cost to society of $18 billion annually in
unrealized income taxes (in the 15% bracket).

* For workers, noise induced hearing loss is the most common
occupational disease and the second most self-reported occupational
injury.

* For seniors, untreated hearing loss causes additional costs to
Medicare and other health programs due to loss of independence, social
isolation, depression, safety issues, and quality of life. The Senate
Special Committee on Aging, in S. Rpt. 107-74, noted: “As the wave of
seniors begins to experience age-related disability, our current long
term care system will not be able to support this demographic shift.”
Hearing aids enable seniors to retain their independence and avoid
other long-term care costs.

* In 1999, the National Council on the Aging (NCOA), in collaboration
with the Hearing Industries Association (HIA), conducted the largest
known study on the effects of untreated hearing loss among adults 55+
and their families. The study quantified both the negative results of
untreated hearing loss and the positive impact of hearing instruments
on an individual’s quality of life. This research clearly associated
hearing aids with impressive improvements in the social, emotional,
psychological, and physical well-being of people with hearing loss in
all hearing loss categories from mild to severe. Specifically, the
data positively related hearing aid usage to the following quality of
life issues. Hearing loss treatment was shown to improve: earning
power, communication in relationships, intimacy and warmth in family
relationships, ease in communication, emotional stability, sense of
control over life events, perception of mental functioning, physical
health and group social participation. And, just as important, hearing
loss treatment was shown to reduce: discrimination toward the person
with the hearing loss, hearing loss compensation behaviors (i.e.,
pretending you hear), anger and frustration in relationships,
depression and depressive symptoms, feelings of paranoia, anxiety,
social phobias, and self-criticism.

Who supports this legislation?

The bipartisan Congressional Hearing Health Caucus has expressed
support for this initiative. Also, in an unprecedented fashion, the
hearing health community has rallied in unison behind this bill,
including major organizations of consumers, providers, educators, and
manufacturers: the A.G. Bell Association for the Deaf and Hard of
Hearing; the American Academy of Audiology, the American Speech
Language Hearing Association, the Deaf and Hard of Hearing Alliance,
the Hearing Industries Association, the Hearing Loss Association of
America (formerly Self Help for Hard of Hearing People) and the
International Hearing Society, among others.