Which listed medical products were exempt when sold to Florida hospitals: prescription-labeled single-use devices, thermometers, catheters, or other supplies?

Plain-English summary

Florida divided the seller's medical products into three groups: prescription-labeled single-use products were exempt, thermometers and catheters were specifically exempt, and the remaining products were taxable. Selling an item to a hospital or using it in treatment did not by itself make the item exempt.

Prescription legend plus one-time use

The seller stated that every listed product was intended for one-time use and identified which ones carried the federal warning restricting sale to or on the order of a physician. The Department treated the listed products with that prescription legend as exempt because they were disposable devices satisfying both conditions.

Thermometers and catheters had their own exemption

Thermometers for human use and catheters were specifically exempt whether or not they bore the prescription legend and whether or not they were intended for one-time use.

The remaining supplies were taxable

The Department classified the other listed products as taxable personal-hygiene products or consumable medical supplies. The quoted rule said sales to physicians, dentists, veterinarians, and hospitals remain taxable unless a product is specifically exempt.

What this means for you

Medical-product sellers should classify each SKU using its labeling, intended number of uses, and any item-specific exemption. A hospital customer and a medical purpose are not enough by themselves under the rule quoted in this ruling.

Common questions

Q: Was every product intended for one-time use exempt?
A: No. For the general disposable-device category, the product also needed the federal prescription legend described in the ruling.

Q: Did thermometers need an RX label?
A: No. Thermometers for human use were specifically exempt.

Q: Did catheters need to be single use?
A: No. The ruling treated catheters as specifically exempt regardless of labeling or number of uses.

Q: Were all sales to hospitals exempt?
A: No. Unlisted personal-hygiene products and consumable medical supplies remained taxable unless another exemption applied.

Citations and references

• Fla. Stat. § 212.08(2) — medical exemptions
• Fla. Admin. Code r. 12A-1.020(6)-(7) — medical supplies, prescription products, and specifically exempt items
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 03A-054

Original ruling text

SUMMARY

QUESTION: What is the taxable status of various listed
medical products

ANSWER - Based on Facts Below: The medical products listed
which have the "RX" label, and which are for one time use,
would be exempt from tax. In addition, thermometers and
catheters are specifically exempt from tax, regardless of
their "RX" status, or the number of times that they are
used. The remaining products would be taxable as either
personal hygiene products or as consumable medical
supplies.

Nov 12, 2003

Re: Technical Assistance Advisement 03A-054
Sales and Use Tax
Taxability of Medical Related Products
Section 212.08(2), F.S.
Rule 12A-1.020, F.A.C.

Dear :

This is in response to your letters of August 7, 2003, and
October 16, 2003, in which you request the issuance of a
Technical Assistance Advisement regarding the taxable status of
certain medical products that your company sells to hospitals in
Florida. In your letter of October 16, 2003, you indicated which
products are "RX", i.e., they contain the labeling "Caution:
Federal Law (USA) restricts this device to sale by or on the
order of a physician." You have stated that all of the products
are intended for one-time use.

The products at issue are as follows:

44105 - Skin Staple Remover Kit

[RX]

54200 - Suture Removal Tray Kit

[RX]

66140 - Sterile Straight Mosquito Hemostat Kit

[RX]

795 - Tape Measure Disposable Pediatric 35 Inch
9623 - Liberty Obstetrical Pads, 12/Bag, 24 Bags/Case
9623G - Liberty Pad, Single Packed
CKF105L - Female Catheter Kit-8fr, Soft, with
Surgilube

[RX]

CKF155L - Pediatric Catheter Kit-5fr, Soft, with
Surgilube

[RX]

CKF205L - Female Catheter Kit-8fr, Firm, with
Surgilube

[RX]

CP24 - Cool Pack Perineal Pads
DC240 - Dental Care Kit
DT1700 - Central Line Dressing Change Tray

[RX]

DT6960 - Central Line Dressing Change Tray

[RX]

DT7590 - CVC Dressing Change Tray

[RX]

H835 - Maternity Kit
IF505 - Infant Feeding Tube Kit

[RX]

IF808 - Infant Feeding Tube Kit

[RX]

IV3480 - IV Start Kit

[RX]

IV5355 - IV Start Kit

[RX]

MC505 - Short Term Mouth Care Kit
MC540 - Mouth Care Kit
MC570 - Softouch Suctioning Kit

[RX]

MC805 - Short Term Mouth Care Kit
MNS1115 - Nose Bleed Tray Kit

[RX]

PE2060 - Pelvic Exam Tray Kit

[RX]

PE2195 - Pelvic Exam Tray Kit

[RX]

PE460 - Pelvic Exam Tray Kit

[RX]

PE925 - Pelvic Exam Tray Kit

[RX]

SB100NEB - 10X10 2mil Specimen Bag with Pouch
SB69BZ - 6X9 2mil Specimen Bag
SV35NST - Sterile Sorbaview with Notch Kit

[RX]

SV40XT - Sterile Sorbaview 2000 with Notch Kit

[RX]

T200010 - Mercury Free Oral Glass Thermometer
T200051 - Mercury Free Rectal Glass Thermometer
W505R - Allergic w/Border

LAW

Section 212.08(2), Florida Statutes, provides in pertinent part
as follows:

(2) EXEMPTIONS; MEDICAL.

(a) There shall be exempt from the tax imposed by this
chapter any medical products and supplies or medicine
dispensed according to an individual prescription or
prescriptions written by a prescriber authorized by law to
prescribe medicinal drugs; hypodermic needles; hypodermic
syringes; chemical compounds and test kits used for the
diagnosis or treatment of human disease, illness, or
injury; and common household remedies recommended and
generally sold for internal or external use in the cure,
mitigation, treatment, or prevention of illness or disease
in human beings, but not including cosmetics or toilet
articles, notwithstanding the presence of medicinal
ingredients therein, according to a list prescribed and
approved by the Department of Health, which list shall be
certified to the Department of Revenue from time to time
and included in the rules promulgated by the Department of
Revenue. There shall also be exempt from the tax imposed
by this chapter artificial eyes and limbs; orthopedic
shoes; prescription eyeglasses and items incidental thereto
or which become a part thereof; dentures; hearing aids;
crutches; prosthetic and orthopedic appliances; and
funerals.... (Emphasis Supplied)

Rule 12A-1.020, Florida Administrative Code, provides in
pertinent part as follows:

(6)(a) Medical products and supplies used in the cure,
mitigation, alleviation, prevention or treatment of injury,
illness, disease or incapacity are taxable, unless:

1. Temporarily or permanently incorporated into a patient
   or client by a practitioner of the healing arts licensed by
   the State of Florida.

2. Ordered and dispensed by or on the prescription of a
   duly licensed practitioner authorized by the laws of the
   state to prescribe medicinal drugs; or

3. Ordered and dispensed by a pharmacist pursuant to the
established dispensing procedures determined by the joint
committee of medical, osteopathic and pharmacy professions
as created by Section 465.186, F.S.

(b) The sale of medical products or supplies to physicians,
dentists, veterinarians and hospitals is taxable even
though the medical products or supplies may be used in
connection with medical treatment, unless the products and
supplies are specifically exempt from tax under this rule
or in Rule 12A-1.021, F.A.C.
...
(7)(a) The chemical compounds and test kits specified in
this paragraph which are used for the diagnosis or
treatment of disease, illness or injury are specifically
exempt. Examples of chemical compounds and test kits
include, but are not limited to the following: Albustix
reagent strips and tablets; blood pressure units;
cholesterol tests; clinistix reagent strips; clinitest
tablets; combistix reagent strips; dextrostix, reagent
strips; dextrotest kit and refills; diabetic test kits;
galatest; ictotest reagent tablets; sugar test tablets for
diabetics; thermometers for human use; tuberculin patch
test; urine testing kits; urograph test. (Emphasis
Supplied)

DISCUSSION

Section 212.08(2)(a), F.S. provides an exemption for medical
products, including medical devices, which are dispensed
according to an individual prescription or prescriptions written
by a prescriber authorized by law to prescribe medicinal drugs.
Included within the scope of this exemption are those disposable
products which meet both of the following criteria: (a) they are
intended for one-time use; and (b) they are required under
federal law to bear a prescription legend that reads either "RX
only," or "CAUTION: Federal law restricts this device to sale by
or on the order of a _" [designation of a licensed health
care practitioner authorized to use or order use of the device].
Therefore, one-time use medical devices or kits which contain
the "RX only" label would be exempt from tax.

Certain items, such as thermometers (for human use) and
catheters, are specifically exempt from tax, regardless of
whether they have the "RX" label or whether they are one time
use or not. See Rule 12A-1.020(7), Florida Administrative Code,
and Form DR-46NT, Nontaxable Medical and General Grocery List,
available on the Department of Revenue's internet site,
www.myflorida.com/dor, for the complete list of products that
are specifically exempt.

There are no exemptions for personal hygiene or cosmetic type
products.

SUMMARY

All of the products listed above with the "RX" label, and which
are for one time use, would be exempt from tax. In addition,
thermometers and catheters are specifically exempt from tax.
The remaining products would be taxable as either personal
hygiene products or as consumable medical supplies.

CLOSING STATEMENT

This response constitutes a Technical Assistance Advisement
under s. 213.22, F.S. which is binding on the department only
under facts and circumstances described in the request for this
advice as specified in s. 213.22, F.S. Our response is
predicated on those facts and the specific situation summarized
above. You are advised that subsequent statutory or
administrative rule changes or judicial interpretations of the
statutes or rules upon which this advice is based may subject
similar future transactions to a different treatment than
expressed in this response.

You are further advised that this response, your request and
related backup documents are public records under Chapter 119,
F.S., which are subject to disclosure to the public under the
conditions of s. 213.22, F.S. Your name, address, and any other
details which might lead to identification of the taxpayer must
be deleted by the Department before disclosure. In an effort to
protect the confidentiality of such information, we request you

provide the undersigned with an edited copy of your request for
Technical Assistance Advisement, backup material and response
within fifteen days of the date of this advisement.

Sincerely,

Jonathan E. Swift
Tax Law Specialist
Technical Assistance and Dispute Resolution
(850) 922-4840

Control #57248