It’s a question I get asked frequently, most recently by a colleague who was shocked to find that his new pair of prescription eyeglasses cost about $800.
Why are these things so damn expensive?
The answer: Because no one is doing anything to prevent a near-monopolistic, $100-billion industry from shamelessly abusing its market power.
Prescription eyewear represents perhaps the single biggest mass-market consumer ripoff to be found.
The stats tell the whole story.
- The Vision Council, an optical industry trade group, estimates that about three-quarters of U.S. adults use some sort of vision correction. About two-thirds of that number wear eyeglasses.
- That’s roughly 126 million people, which represents some pretty significant economies of scale.
- The average cost of a pair of frames is $231, according to VSP, the leading provider of employer eye care benefits.
- The average cost of a pair of single-vision lenses is $112. Progressive, no-line lenses can run twice that amount.
- The true cost of a pair of acetate frames — three pieces of plastic and some bits of metal — is as low as $10, according to some estimates. Check out the prices of Chinese designer knockoffs available online.
- Lenses require precision work, but they are almost entirely made of plastic and almost all production is automated.
The bottom line: You’re paying a markup on glasses that would make a luxury car dealer blush, with retail costs from start to finish bearing no relation to reality.
Carmen Balber, executive director of Consumer Watchdog, a Santa Monica advocacy group, has worn glasses her entire life. She figures she’s spent thousands of dollars over the years on new frames and lenses.
“Anyone who wears glasses would agree that cost is out of control,” Balber told me.
She said soaring eyeglass costs should be a part of the country’s overall healthcare debate in light of the fact that many people simply couldn’t function without corrective lenses.
“At the very least,” Balber said, “there needs to be some transparency about how much things really cost.”
Good luck with that.
I reached out to the Vision Council for an industry perspective on pricing. The group describes itself as “a nonprofit organization serving as a global voice for eyewear and eyecare.”
But after receiving my email asking why glasses cost so much, Kelly Barry, a spokeswoman for the Vision Council, said the group “is unable to participate in this story at this time.”
I asked why. She said the Vision Council, a global voice for eyewear and eyecare, prefers to focus on “health and fashion trend messaging.”
And because it represents so many different manufacturers and brands, she said, it’s difficult for the association “to make any comments on pricing.”
Which is to say, don’t worry your pretty head.
What the Vision Council probably didn’t want to get into is the fact that for years a single company, Luxottica, has controlled much of the eyewear market. If you wear designer glasses, there’s a very good chance you’re wearing Luxottica frames.
Its owned and licensed brands include Armani, Brooks Brothers, Burberry, Chanel, Coach, DKNY, Dolce & Gabbana, Michael Kors, Oakley, Oliver Peoples, Persol, Polo Ralph Lauren, Ray-Ban, Tiffany, Valentino, Vogue and Versace.
Italy’s Luxottica also runs EyeMed Vision Care, LensCrafters, Pearle Vision, Sears Optical, Sunglass Hut and Target Optical.
Just pause to appreciate the lengthy shadow this one company casts over the vision care market. You go into a LensCrafters retail outlet, where the salesperson shows you Luxottica frames under various names, and then the company pays itself when you use your EyeMed insurance.
A very sweet deal.
And Luxottica is even bigger after merging last fall with France’s Essilor, the world’s leading maker of prescription eyeglass lenses and contact lenses. Do you have Transitions lenses in your frames? You’re an Essilor customer.
The combined entity is called EssilorLuxottica.
I reached out to the parent company as well as the Luxottica and Essilor subsidiaries asking about how frames and lenses are priced. None of them got back to me.
It’s almost as if the last thing they want is to have to explain why consumers are paying 10 to 20 times what frames and lenses actually cost.
I wasn’t able to make any headway even with Warby Parker, the New York-based eyewear company whose whole raison d’etre is to offer fashionable specs at a fraction of the price of other retailers.
Dr. Ranjeet Bajwa, president of the California Optometric Assn., suggested that consumers actually are getting good value for their money.
“We often see low-ball retailers promise price savings but fail to deliver the quality patients expect in terms of fit, comfort, durability and, of critical importance, precision in vision, over one or two years of daily wear,” he said.
“Eyeglass sales are becoming a very competitive market, with frames and lenses available in a range of prices and quality levels,” Bajwa said. “Today’s glasses aren’t the glasses of 20 years ago, and the price can reflect these technological advances.”
Fair enough. But with about 126 million American adults wearing prescription glasses, and many replacing those glasses every few years, you have to assume it doesn’t take long for frame and lens makers to recover any R&D costs.
It’s a dynamic that routinely plays itself out elsewhere in the healthcare field, with new prescription drugs costing patients a fortune as drugmakers insist that they had to spend millions bringing the med to market.
Yet prices of branded drugs seldom go down even years after their R&D costs have been amortized. To cite just one example, insulin costs have tripled in recent years, even as the number of people with diabetes continues to rise, allowing manufacturers to recoup expenses in a relatively short time.
The high cost of frames reflects a market that is woefully lacking in meaningful competition. Warby Parker recognized this as a business opportunity. I’m surprised others haven’t jumped in as well with reasonably priced eyewear.
Lenses are a whole other matter. This is the “healthcare” component of vision correction and as such should be affordable to all. However, as with prescription drugs, government officials are content to pretend that “the market” will protect patients.
It won’t. And the more than 1,000% markup for most vision products proves that.
Why do glasses cost so damn much?
Because this industry has been getting away with fleecing people for decades.
And you don’t have to look hard to see this won’t change any time soon.