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5April2017

Sales practices might be misleading or


unconscionable
Australian Competition and Consumer Commission said
commissions, incentives and sales targets are pervasive in the
audiology industry and some clinics are in relationships with
finance providers.

Hearing health specialists to give


evidence to national inquiry into Hearing
Health and Wellbeing of Australia
The next in a series of public inquiries in Sydney this week will
hear from specialists involved in all aspects of hearing health,
from screening for hearing loss to undertaking cochlear
implant surgery. Join the live streaming and access captions.

Brett Lee on hearing loss in India


63 million people in India suffer some form of hearing loss.
Australia has a mandated hearing test for every newborn but
screening is low in India.

Seniors learn lip reading to find


confidence in the hearing world
Every Wednesday, a group of Bunbury seniors who live with
hearing loss get together to chat and laugh - and read lips.
"It is definitely an art form. Some of our members pick it up
immediately, and others come for years and still don't pick it
up. They keep on coming because of the wonderful feel of
our group."

We acknowledge the traditional custodians of the land, community, sea, and waters where we live and work. We pay our respects to
elderspast,presentandfutureandvaluethecontributionsIndigenousAustraliansmakeinoursociety.Weacknowledgethechallengefor
IndigenousleadersandfamiliestoovercometheunacceptablyhighlevelsofearhealthissuesamongfirstAustralians.
The Australian Competition and Consumer Commission (ACCC) released a
report in March, Issues relating to the sale of hearing aids.

The ACCC found that commissions, incentives and other mechanisms designed to drive sales can
create a conflict with clinical independence, professional integrity and the primary obligation to
consumers.

Representatives of the ACCC gave evidence to a recent hearing conducted by the Commonwealth
Standing Committee on Health, Aged Care and Sport. The Committee is investigating the Hearing
Health and Wellbeing of Australia. The following is a transcript of evidence provided to the inquiry
by Richard Fleming and Scott Gregson.

Key points
Commissions, incentives and sales targets are pervasive in the audiology industry.
Sales practices might be misleading or unconscionable - if proven would raise
serious concerns under the Australian Consumer Law.
Some clinics are in relationships with finance providers.
ACCC urges industry to make changes.
ACCC has strong view that giving more information will not protect consumers.
Governments can look at regulatory models that might limit or remove
commission based sales.
Clinics can look at separating the provision of health services from the retail
environment.

Transcript
ACCC: Let me start with the types of issues that might raise concerns under our legislation. The
Australian Consumer Law is the area that we are mostly interested in in this context. We are
concerned that some practices might be either misleading or, alternatively, so unfair that they
might be considered unconscionable. They are the headings that we looked at it under and the
provisions that we would have turned our mind to. Both in the initial investigation and in the
follow-up from the survey, while our concerns remained, it was difficult to find instances that we
were able to pursue from an enforcement perspective. This is often influenced by dealing with
quite vulnerable consumers who have, at times, memory issues or a willingness to assist us in a
formal way through investigations. It is also the case that anecdotal information that comes to us
is not always backed up with the evidence required to run a prosecution. The reason that we are
still quite strident with our concerns and issuing that report is that we do believe there is conduct
of concern and, if it proved up, it would raise serious concerns under the Australian Consumer
Law. The purpose of our report is to raise awareness, to persuade changes and to inform the way
in which consumers can participate in the marketplace. But a fourth area is that it may actually
provide further information or evidence that we can pursue through investigations and possible
action.

COMMITTEE: From the investigation that you undertook, are you able to extrapolate or indicate
how widespread you think this is? There are two issues. Obviously the use of commissions is
widespread within the sector. But would you regard it as a common feature of the sector that the
use of commissions was leading to poor outcomes for consumers?

ACCC: It is very hard to be comprehensive in our comments when our involvement was not an
extensive exercise. There are certainly individual audiologists, audiometrists or clinics that are
doing things better than others, so we want to make that point very clear. What is clear is that
commissions, incentives and interest on targets are quite pervasive in the industry, and that has a
tendency to lead, depending on the culture and the nature of the persons involved, to a greater
number of instances than we think would apply in other industries.

COMMITTEE: I noticed in your report, in addition to monetary commissions and incentives, you
allude to the fact that, for example, some clinicians are offered performance rewards like overseas
travel. Was that something that you were able to verify with clinics?

ACCC: We did not get down to that level, because the evidence did not lead us to an enforcement
outcome. But it was one of those issues that are in the mix. I think it is important to think of
these different elements collectively. So it is not just the sales targets but the sales targets plus
commissions plus incentives, and the high cost of some of the devices as well, that leads to the
harm.

COMMITTEE: This is my final question at this stage. You are obviously constrained and have to
act within the scope of your powers. Is it within your ability to say to us today whether you
believe there are further regulatory measures that should be taken by government? I am
interested in your views whether it is Commonwealth or state. Are there further regulatory
measures that should be taken to more effectively preclude the types of practices that you
identified?

ACCC: We are urging industry in the first instance to make changes. It is in their capacity to
change the way they operate in their own businesses. But we have made it very clear, I think, to
the relevant policy areas and to those who may become involved through changes such as the
NDIS that they need to be conscious of these issues and to consider if there are steps that they
should be taking on that front. Clearly we see that commissions and incentives are driving much
of the behaviour of concern here and there are instances from other regulatory environments
where the commissions and incentives have been dealt with.

COMMITTEE: In the investigation that you conducted, you identified three key areas: (1) sales
that may be driven by commissions or other incentives rather than consumer need, (2) cost and
performance of hearing aids and (3) the treatment of vulnerable consumers. Would you be able
to give us some examples of what has taken place in areas (1), (2) and (3) that you heard about
or saw? What are some examples where you saw evidence that sales may be driven by
commissions rather than consumer need, for example?

ACCC: In some respects the three categories there are very much linked. To some extent the
concerns we have about sales practices driven by commissions and incentives lead to the third
category of dealing with vulnerable consumers, and indeed we think can lead to the provision of
either inappropriate devices or overselling or upselling to devices that may not be necessary. That
is the evidence that came through.

COMMITTEE: Would you be able to give us an example of some of that evidence, of what took
place?

ACCC: I have got some examples here that might give you a sense of some of the colour and
movement of what we found. One of the examples was of a male consumer who was
initially quoted $10,000 for a pair of hearing aids. He then shopped around, did his research and
purchased a top brand from a discount retailer for $3,000. We also received evidence from
clinicians. There was one example where a researcher sat in numerous consultations between
clinicians and consumers. The feedback to us was that that person believed that the pressure on
clinicians was there to sell hearing aids, and that is a significant pressure, and the assessment
from that person was that they were overselling, upselling and focusing on that rather than caring
for the clinical needs of the consumer. So there are a range of things. These are vignettes that
we received from the survey. I can outline some more if you would like.

COMMITTEE: Did you get a feel that this was common practice or that it happens regularly, or
that it was a one-off?

ACCC: The way that the survey was conducted led people to self-report a lot of these things, so it
is really hard to get a good sense of whether this is five per cent, 10 per cent or 50 per cent of
the market. I think the issue for us is that the system is designed in a way where these things
exist and create incentives for clinicians to engage in this kind of conduct. So I guess it is a bit
hard to say anything with any more granularity than that.

ACCC: I would add one feature, which is in our report but has not been heavily reported since, but
I think it is a feature that adds to the harm that we saw. Not only are some consumers in our
view being upsold productsand not always the best suited product, and there is a financial cost
involvedbut there is also access to finance that is sometimes provided, and to have a further
burden of ongoing payments when a product turns out not to be best suited just adds to those
issues of harm that we saw.

COMMITTEE: So the clinics are not only selling the hearing aids but also actually in relationships
with finance providers?
ACCC: Yes, certainly the anecdotes people put to us were that there are instances where that
finance is facilitated either through contacts or deeper.

COMMITTEE: When a consumer purchased a high-end hearing aid, were there any reports that
the additional features of that particular hearing aid were beneficial or not beneficial? Did you get
a bit of a feel for that?

ACCC: Again, we are not the experts, and there are others in government you have spoken to
who may have a greater sense. But what we were told by those that we spoke to who are in the
industry is that the particular needs of a particular consumer are varied. Some may like live
music, for example, and that requires additional features; whereas others are more interested in
conversations with family. The higher end devices therefore are often above and beyond and not
always suitable. So, yes, we did see anecdotal evidence of those scenarios.

COMMITTEE: The other issue is the remuneration that is used for sales based salaries or sales
based commissions. In the view of the ACCC, is there a structure that would be more suitable to
an industry like this than the current remuneration structure, which takes the edge out of the high
sales pitch?

ACCC: Talking frankly, we do see that there should be a shift there. We do not want to be
prescriptive as to the areas. But what is important to note here, and why it might be different
from other industries, is that we do not think consumers fully understand, when you are going
into a clinic situation where you have people that you think might be trusted health professionals,
that they are also being remunerated on commission, and that might influence what is being sold
to you. There are those features, particularly with a potentially vulnerable subset of consumers,
either because of age, the hearing issue itself or other disability. So we do think there is that
quadruple whammy of impacts that apply here. It is interesting that you can look at regulatory
models that might limit or remove commission based sales. Alternatively, industry and others
could look at separating the provision of health services from the retail environment, and that is
not uncommon in other areas.

ACCC: Just to add to that, one of the responses often in these scenarios is to give consumers
more information. Our strong view is that that really is not going to help. Given the nature of the
consumers involved and the devices themselves are very complex issues. Disclosure alone is not
going to remedy the issue.

COMMITTEE: During the course of ordinary business, have you seen an increase or a decrease in
referrals to the ACCC in this area? Is there a particular trend over the last 12 months to two
years? Do you get regular inquiries about this?

ACCC: I think it is fair to say that we are not the obvious point of call for consumers having issues
with the provision of hearing aids or, indeed, all health services. We do not have a track record of
getting many complaints that we can provide a trendand I will check shortly if my advice is
right. However, we have since obviously expressing our interest at the time of the survey and
then, subsequently, from our report had a number of inquiries come through.

COMMITTEE: Since you released your report, have you had the opportunity to meet with or
receive any reaction from players in the sector?

ACCC: We contacted those players that we have been dealing with throughout the inquiries at the
time we issued the report and provided them a copy at that time. We have had some approaches
from some in the industry wanting to have further discussions. We have not had those
discussions as yet.

COMMITTEE: What is your understanding of how the audiology sector or this sector regulates
itself and the standards that it imposes on itself currently?

ACCC: In some respects, they are not regulated to the same extent as other health professions.
We understand there are some associations for audiologists and audiometrists, and they provide
some level of oversight and standards. Of course, participation in the government schemes is a
further check and balance that provide some regulation. Beyond that, my understanding is that
there is not that level of regulation that you see in other health sectors.

COMMITTEE: And there is not a code of conduct that applies to the industry?

ACCC: My understanding is that there is a joint code of conduct for some members but that does
not involve bans on clinicians from receiving commissions or inducements.

COMMITTEE: I note your point that you are relying on industry to examine its practices of its own
volition. Can I take it back to the regulatory options. Could you expand on what you think the
options are that are open to government?

ACCC: Again, not being a health expert or health regulatory export, I will give you more generic
comments that we see in other instances where government, through legislation or otherwise, can
ban commissions. They could insist on separation of provision of health services from the delivery
of retail supply of products, and certainly where there are links to the impact on government
programs use the administrative requirements through those programs to drive similar types of
changes.

COMMITTEE: Would you argue that incentives and commissions should not be used in the sector
at all?

ACCC: From the features we have seen in their current state, the combination of those will very
often lead to bad behaviour and, yes, we think that the issue should be very clearly looked at to
stop these commissions or limit them in some way.
COMMITTEE: When you talk about administrative arrangements, I assume that means, for
example, something like the Commonwealth using its market power through the vouchers it issues
to make clear that those vouchers can only be redeemed at clinics where commissions are not
paid. Is that the type of example?

ACCC: They would be the types of rules or procedures that could be contemplated; that is right.
Not dissimilar to the VET FEE-HELP matters I referred to there, they will be dealt with not
necessarily through the legislative requirement but through a requirement for participation in the
scheme.

ACCC: I think it depends. You could regulate the process we have spoken about: the voucher
scheme. You could regulate the professionals, a bit like other health professionals are regulated
through state-based boards. That is a more extreme model than what currently happens now. It
depends on the issue you are trying to address.

COMMITTEE: Would you see it being addressed at the Commonwealth level or at the state level?

ACCC: Again, if it is about the program then I think the natural home would be the
Commonwealth, given the ownership. I think a lot of the health professional regulation is done
nationally but through state-based approaches, so I guess it depends.

COMMITTEE: If a clinician believes that he or she is working at a practice where pressure has
been brought to bear to meet sale targets in a way that compromises the integrity of their
professional advice, what would your advice be to such a clinician in terms of where they should
take their concerns?

ACCC: There would be a number of ports of call. They can always take those up with their
employer. They can take them up with their professional association if they are involved in one.
We are particularly keen to hear from those people to inform us in terms of any further action or
leverage that we should undertake in the marketplace. It is concerning to us that some of those
who came to us through the surveys and, indeed, references in the media identified some
audiologists who have chosen to resign rather than be involved in those businesses. I think that
demonstrates the height of the concerns that those audiologists have. I should point out that we
think and we have seen instances where those professionals have been put in a very difficult
position by these commissions and the pressure that is put on them.

COMMITTEE: This is an unfair question in some ways, but if we had representatives of the sector,
and we will have some of the big clinics before us today, what do you think their defence of their
practices would be?

ACCC: I think it is common when we probe these types of issues in any industry for parties to say
that commission-based sales are a normal part of business. They say that providing wage
incentives for performance is part of a market economy. They would say that it is an industry-
wide approach, and therefore they are doing what they do elsewhere. Invariably, industry tells us
that they have the culture, the protocols and the systems in place to prevent bad behaviour while
these commissions exist. Our experience as a consumer regulator is that we see in industry after
industry where there are commission-based sales with vulnerable consumers, that the
commissions do lead to bad incentives and bad behaviour. You have to have very strong systems
and counterculture to deal with that. We have seen that in energy door-to-door and in the VET
FEE-HELP space, and we are seeing public reports even in the charity sector about the way in
which donations are sought by third-party providers on commission. We would encourage you to
push through those responses and really test whether the systems in place are sufficient to
counter those incentives.

Know more about this story? Contact the Australian Competition and Consumer
Commission, https://www.accc.gov.au/consumers/complaints-problems/make-a-
consumer-complaint

Comment by Hearing Care Industry Association


Hearing Care Industry Association (HCIA) represents hearing healthcare providers in Australia. Its
members fit around 60 percent of the hearing devices used in Australia. View its members at
http://hcia.com.au/member_organisations.html

As indicated when the ACCC published their Report, HCIA is committed to working with the ACCC
to ensure that industry regulations and standards are appropriate.

All members of the HCIA are registered to provide services under the Federal Government
hearing services program and are also regulated by Commonwealth/State/Territory legislation
governing health complaints laws, public health regulation, consumer protection law, employment
law, criminal law and the law of contracts.

HCIA members only employ audiometrists and audiometrists who are accredited by their
professional bodies and who comply with the National Code of Conduct of all health workers.

HCIA members adopt standards to ensure that every client will receive the most appropriate
assistance that deals with their hearing loss and their individual needs and we constantly strive to
improve the service and care we offer to Australians living with hearing loss.

We welcome the opportunity to address any matters of concern and intend to discuss these
matters directly with the ACCC.
Comment by Self Help for Hard of Hearing People (SHHH)
SHHH Australia Inc welcomes the ACCC findings and endorses its recommendations to improve
the transparency and customer focus of the hearing device industry. The findings are consistent
with SHHHs own submissions to the Hearing Health Inquiry.

A key requirement for hearing device consumers is reliable and unbiased information from the
professionals in whom they place their trust. SHHH believes there is a role for advocacy groups to
help consumers maximise the benefits of the hearing devices recommended by hearing health
professionals.

Hearing Health specialists to meet with Health


Committee
Hearing health specialists will meet this week with the Australian Parliaments Health, Aged Care
and Sport Committee in Sydney as part of its Inquiry into the Hearing Health and Wellbeing of
Australia.

The Committee will be meeting with specialists involved in all aspects of hearing health, from
screening for hearing loss to undertaking cochlear implant surgery. Professions that will be
represented include: audiologists; audiometrists; audiometry nurses; rehabilitation counsellors;
and ear, nose and throat surgeons.

The Committee Chair, Mr Trent Zimmerman MP, stated that hearing loss already affects one in six
Australians and, with an ageing population, its prevalence is increasing. The Committee will
discuss with hearing specialists how to ensure that Australias hearing care system continues to
seek improvements and, where appropriate, deploy new technologies to meet the current, and
future, demand for high quality hearing care services.

Further information about the Committees inquiry, including the public hearing program is
available at http://www.aph.gov.au/Parliamentary_Business/Committees/House/
Health_Aged_Care_and_Sport/HearingHealth/Public_Hearings

Public hearing details: 8:30am - 4:30pm, Thursday 6 April, Macquarie Room, Parliament of NSW,
Sydney

Live Remote Captioning is available for this hearing. For more details go to
http://www.aph.gov.au/Parliamentary_Business/Committees/House/Health_Aged_Care_and_Sport
/HearingHealth/Public_Hearings

The hearing will be streamed live at aph.gov.au/live


Break the Sound Barrier is the name of the campaign that aims to put
Hearing Health and Wellbeing on the national agenda.

One in six Australians has a hearing health and well-being issue.

An estimated 3.55 million Australians experienced some degree of hearing loss, making it a more
common health condition than cardiovascular disease, asthma, or diabetes. Due to Australias
ageing population the number of people experiencing hearing loss is also rising and is expected to
reach one in every four Australians by 2050.

People with a hearing loss or who communicate in Auslan are not recognised within the public
consciousness as having a serious disability that impacts on almost every aspect of a persons life.
We need you to share our campaign with your friends, colleagues and family members to
encourage them to sign up.

With millions of Australians affected, hearing health and wellbeing deserves to be a national
health priority.

www.breakthesoundbarrier.org.au
Brett Lee spreads awareness on hearing loss in India
Hearing impairment is the second most common cause of disability after locomotor disability.
India has more than 50 lakh citizens who suffer from some form of hearing loss.

"Around 63 million people in India suffer some form of hearing loss. Parents and family members
should not ignore the smallest signs of hearing loss and should take speedy action. Australia has
a mandated hearing test for every newborn," Lee told IANS.

"In India, however, awareness about Universal Newborn Hearing Screening still remains low. I
was in Kerala last week and we need to applaud the efforts taken by the State Government in
conducting newborn hearing screening in most hospitals.

There are even looking at a plan to make screening for hearing compulsory in all hospitals. Kerala
has set a shining example for us and I would urge the other parts of India to take note and act on
this," he added.

Lee informed that he had a traumatic experience when his son, who was then just five years old,
had a fall and fractured a small part of his skull. The injury was close to his ear and led to hearing
loss in one ear.

"Fortunately over the next eight months or so, his hearing got back to normal. But those days
just made him realize that no one deserves to live in silence," Lee said.

The 40-year-old said his mission is to spread the awareness of the significant medical, social and
economic impact that hearing loss can make on individuals and their families.

From Z News, http://zeenews.india.com/cricket/ex-australian-speedster-brett-lee-spreads-


awareness-on-hearing-loss-in-india_1988768.html
Seniors learn lip reading to find confidence in the hearing
world
By Ruslan Kulski, ABC South West WA

Pat Kitchen, 92, has attended lip reading class for 37 years. (ABC South West WA: Ruslan Kulski)

Every Wednesday, a group of Bunbury seniors who live with hearing loss get together to chat and
laugh - and read lips.

Pat Kitchen has attended the Bunbury Better Hearing Group since it started 37 years ago. "I
come for company and we all support each other," she said. Mrs Kitchen, now nearly 92 years
old, lost her hearing in an accident when she was 22. "I won't let it defeat me," Mrs Kitchen said.

Cynthia Dutton, who runs the class, has seen its benefits in her own life. "Before I joined Better
Hearing I was basically a homebody; I didn't go out, I didn't socialise," Mrs Dutton said.

The group solves the isolation people with hearing loss can experience by helping them learn the
skills they need to move confidently through the hearing world. Those skills don't come easily
though; lip reading takes effort to learn.

"It is definitely an art form," Mrs Dutton said. "Some of our members pick it up immediately, and
others come for years and still don't pick it up. They keep on coming because of the wonderful
feel of our group."

Lip reading is not a panacea for hearing loss; instead, it works best in conjunction with hearing
aids, signing and other tools. A common misconception of lip reading is that it gives users the
ability to see what is being said from a distance. The reality is that lip reading is one of a variety
of cues that people with hearing loss use to extract meaning from a verbal conversation; body
language or subject matter are other examples.

http://www.abc.net.au/news/2017-03-03/lip-reading-gives-seniors-confidence/8316718
STOP, LOOK, WAVE is a campaign by Volvo Trucks to help raise childrens awareness of how to
behave safely in traffic.

Children (and adults) who have hearing loss are at particular risk in traffic situations.

STOP, LOOK, WAVE is a free education campaign that teaches Australian children to STOP on the
side of the road, LOOK both ways, and WAVE at the truck driver before they cross.
Volvo Trucks released a new training video teaching people how to implement the STOP, LOOK,
WAVE campaign.

More information at http://www.volvotrucks.com.au/en-au/about/stop-look-wave.html

Watch the new training video at


https://www.youtube.com/watch?v=SnqhqwrQQCk&feature=youtu.be
Accessible travel Training Apps
Instructional travel training app videos are now available on the Transport for NSW YouTube
channel which can be accessed through the links below. Feel free to share these video links or
use them for travel training within your organisation.

Visit the transportnsw.info website. The transport apps overview page is at


http://www.transportnsw.info/apps

Help make public transport even more accessible in NSW


Transport NSW wants volunteers with disability to be part of testing of its accessible transport
initiatives things such as railway station design/features, emergency responses, accessible
signage and hearing loops on trains.

If you have an interest in accessible transport, contact Christine at Self Help for Hard of Hearing
People (SHHH) at chrisann1360@gmail.com

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