I don't have an exact answer, but it's a common problem: http://en.wikipedia.org/wiki/Hyperacusis

Hearing is complex: you have the cochlea acting as both sensor and first pass signal processing. There's a muscle that acts as a built-in gain control that can cut sounds by about 20dB, partly so your own voice doesn't deafen you.

Hearing damage isn't just loss of sensitivity—apparently it can alter the shape of cochlear filters' response too, changing the way masking works. And I'd imagine the brain tries to compensate as hearing loss progresses, which could have interesting effects.

More info:

http://en.wikipedia.org/wiki/Auditory_masking http://en.wikipedia.org/wiki/Acoustic_reflex

Edit: Less related, but a similar phenomenon that happens to me: http://en.wikipedia.org/wiki/Misophonia. Hearing has odd failure modes.

Over time, the ear loses it's ability to carry very loud sounds through all the stages needed for sensation.

This manifests in two basic ways:

1. Fatigue.

That pop music, "wall of loud sound" album was tolerable for a few hours at age 20, gets tiresome at 40, and could be almost painful at age 60. Hearing is a mechanical process, and worn out mechanical parts tend to rattle, lose response, etc... and this is fatigue.

People will respond with something like, "I'm tired of hearing", and to them, the experience of hearing is no longer transparent at higher volumes and longer times.

2. Less dynamic range possible / pain

Think of it like gamma for displays. There is a curve of sensation to input sound in db. People tend to vary a lot, but this curve gets bent away from the normal to a condition that is a lot like "crushed black" and white, where the upper limit of sound volume perception gets distorted.

An unimpaired person can tell the difference between 60, 80, 100db. People who have aged and have losses, may not be able to tell much difference between those volume levels, resulting in "all loud sounds are just loud" not different amounts of loud.

Also think of banding when color depth is reduced. Rather than a nice, smooth response, the listener gets more steps, or various steps may all present in ways that are similar when they should be easily distinguished.

A related thing is discrimination, and it happens with pitch in the same way that it can happen with volume. Loss of pitch discrimination means being unable to distinguish between close frequencies, hearing them as one, or perhaps just as a muddled combination, not as two distinct tones.

This is subtle, and it can happen with most other responses being normal. But the person just can't quite pick out the sounds, despite hearing them individually just fine. It's the combinations they struggle with.