A company called Sonitus Medical recently acquired FDA approval for its new hearing aid system. It's called SoundBite, and involves two machines: one that slips behind the user's ear, and another that fits on the molars. Sound picked up by the earpiece is transmitted wirelessly to the mouthpiece, which vibrates the teeth. The vibrations can be understood by the inner ear as sound.
Link | Product Page | Photo: Sonitus Medical
Link | Product Page | Photo: Sonitus Medical
Not quite. It's just an alternative way of transmitting sound to the cochlea. Normal hearing aids transmit sound through the ear canal and middle ear to get to the cochlea, while this bypasses that particular pathway by transmitting sound directly to the cochlea via a bone conducted pathway. Either way the hair cells are exposed to the same level of sound.
As for hearing loss caused by hearing aids, this is extremely uncommon. Modern hearing aids amplify sound nonlinearly, meaning that they amplify soft sounds more and louder sounds very little if at all. They also have maximum output levels that are lower than the level of noise that is required to cause damage to the hair cells.
http://beckerexhibits.wustl.edu/did/19thcent/index.htm
This would be good for people with absent or malformed ear canals who can't wear conventional aids, or for people with severe middle ear pathology. At the moment, the only device for them is a bone anchored hearing aid that requires a screw to be surgically implanted into the skull.
One day we'll be able to walk into pharmacy to buy a drug to regain the actual and normal and natural hearing.