Mother has always had hearing issues and now has dementia. Can dementia make hearing worse?

Yes, it does. There's been research on how hearing loss causes or exacerbates dementia.

Ears send signals to the brain, and if ears lose function, the signals aren't getting to the brain. The connections between ears and brain then atrophy. The brain, which is then not getting signals, stops functioning as it should. So.....dementia. Add hearing loss to Alzheimers, which is caused by growth of plaque in the brain, and you've got a double whammy to the brain. Not good.

Whatever it costs, get hearing aids if you can't hear.

I have read that there are studies that indicate that people who don't get hearing aids when they need them are more likely develop dementia than those who get them. They would also become more isolated and miss out on a lot of communication and stimulation, which could contribute to dementia.
I think dementia might also lead to more hearing loss. Doctors have told me that the brain can lose it's ability to decode sounds. That's why you should get hearing aides as soon as you start to hear less, if you wait your brain's ability degrades. It would seem to make sense, then, that dementia could have a similar effect. You may be hearing OK but lose the ability to make sense of it.

Various things going on here.

Hearing loss definitely makes dementia worse, because it's so isolating. Also, people with dementia already have a hard time processing information, but being hard of hearing makes it even worse, because they aren't hearing the information clearly in the first place.

My mother was extremely hard of hearing, plus she'd started refusing to wear her hearing aids, so when she died I'm sure she not only didn't hear anything going on around her, her dementia would have prevented her from understanding. We still told her we loved her anyway.

Here is an article on this very subject:

https://rnid.org.uk/hearing-research/hearing-loss-and-dementia-how-are-they-linked/#:~:text=We%20also%20know%20that%20hearing,the%20impact%20of%20hearing%20loss.

From the article:

" We also know that hearing loss can speed up the onset of dementia, or make the symptoms of dementia appear worse, and dementia can heighten the impact of hearing loss."

Someone with dementia may be hard of hearing(and yes it can get worse), but they also often lose their ability to comprehend the spoken word which can present as "hard of hearing" when in fact they're just not understanding what is being said.
So they may say what? and ask you to repeat what you said, not because they didn't hear it but because they didn't understand what was said.
I went through this with my late husband all the time.

Actually, loss of hearing leads to increased dementia - not the other way around.

It might not be the hearing it might be the processing.
I read once that it can take 45 to 60 seconds for a person with dementia to process what was said.
I don't know about you but in a conversation in 60 seconds...1 minute...I may be on to a totally different subject.
this can make it very difficult for someone with dementia to follow a conversation or even respond to a question. For example..."Betty do you want a tuna sandwich or a turkey sandwich for lunch?"
now you wait.....and wait.... for a response.
And you wonder did "Betty" not hear me? It might be that her brain is processing the question then trying to formulate a response but you are in a hurry and walk away to make a turkey sandwich...that she does not eat much of because she wanted soup.

Hearing loss increases dementia and equally important, it increases a lack of comprehension unrelated to dementia. Words get muddled or misunderstood or just missed and the person tries to weave meaning from might be only 30% of the conversation that was heard correctly.

Yes hearing loss exasperates dementia, as with all the senses it adds to the confusion if a person cannot hear what is being said to them or if they cannot see very well.

Nanaw6: Yes, when you lose hearing, it may hasten dementia.