Were single-use postoperative pain pumps purchased by a physician or clinic exempt from Florida sales tax?

Plain-English summary

A healthcare provider used a one-time infusion pump and catheter to deliver medication directly to a surgical site for up to five days after surgery. The device carried the federal prescription restriction, the patient wore it home, and the patient discarded it when the medication was exhausted or the device was no longer needed.

Florida found the single-use pump exempt when purchased by the physician or clinic and dispensed to the patient by a licensed physician. One-time medical devices bearing the required prescription legend qualified when dispensed for the patient's benefit.

The result changed for reusable pumps. If the healthcare provider retained ownership rather than transferring the pump to the patient, the provider was the consumer and its purchase was taxable. The ruling also noted separate exemptions for catheters and for drugs, including pain medication, sold to or by physicians.

What this means for you

The distinction was not simply whether the device served a medical purpose. Florida looked at prescription labeling, dispensing to the patient, single-use status, and whether ownership transferred or remained with the provider.

Common questions

Were the one-time pain pumps exempt when the clinic bought them? Yes, when a licensed physician dispensed them to patients under the stated facts.

What prescription labeling mattered? The device bore the federal restriction limiting sale to or on the order of a physician or other authorized healthcare practitioner.

Were reusable pain pumps exempt too? No, not when the provider retained ownership. Those purchases were taxable to the healthcare provider.

Were catheters treated separately? Yes. The ruling states that catheters were specifically exempt under the cited rule.

What about the medication in the pump? Sales of drugs, including pain medication, to or by physicians were specifically exempt under the cited statute.

Citations and references

• Fla. Stat. § 212.08(2)(a), (b), (f) (medical products, prosthetic devices, and physician drug sales)
• Fla. Admin. Code r. 12A-1.020(6) (medical supplies dispensed or incorporated into a patient)
• Fla. Admin. Code r. 12A-1.021(1) (prosthetic appliances and catheters)
• Fla. Admin. Code r. 12A-1.002(1) (healing-arts practitioners as consumers)
• Fla. Stat. § 213.22 (Technical Assistance Advisements)

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 06A-046

Original ruling text

SUMMARY
QUESTION: What is the taxable status of one-time use "pain pumps" which will be dispensed to patients?
ANSWER - Based on Facts Below: A "pain pump" which will be dispensed to the patient by a licensed physician is
exempt from tax when purchased by the physician or clinic. The purchase of reusable pain pumps where ownership of
the pain pump will not be transferred to the patient would be taxable to the healthcare provider.

December 20, 2006

Re: Technical Assistance Advisement 06A-046
XXX ("Company")
Sales Tax
Medical Devices - XXX
Section 212.08(2), F.S.
Rules 12A-1.021, 12A-1.002(1), and 12A-1.020(6), F.A.C.
Dear:
This is a response to your letter of XX, requesting a Technical Assistance Advisement regarding the tax treatment of
the "XXX" device. This response to your request constitutes a TAA under Chapter 12-11, Florida Administrative Code
(F.A.C.), and is issued to you under the authority of Section 213.22, Florida Statutes (F.S.).
ISSUE
Are the purchases by a medical services provider of "XXX" devices exempt from tax pursuant to Section 212.08(2),
F.S.?
FACTS
You provide the following information:
A XXX is an infusion device that is used to help manage post-operative pain. The XXX , which consists of a XXX
device and catheter, is inserted into the human body through its catheter by a licensed surgeon as part of performing
a surgical procedure. XXX deliver continuous and controlled amounts of medication directly to the surgical site. The
medication is delivered through the pump’s catheter and at a surgeon-controlled flow rate. Pain relief, also known as
analgesia, is experienced at the local incision site without the side effect of narcotics. Used for up to five days after
surgery, the pain pump has other benefits including relieving patients of the worry of medication wearing off and

allowing patients to quickly regain mobility and control of their activities of daily living.
In my telephone call to your representatives, it was indicated that the "XXX" was for one time use and that it had the
labeling that restricts the device's sale to or on the orders of a physician. It was also indicated that the patient wore the
device home after surgery and discarded it when no longer needed or when the drugs ran out.
LAW
Relevant Florida Statute and Florida Administrative Code provisions are as follows:
Section 212.08, F.S., provides in part:
(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... prosthetic and orthopedic appliances;...
(b) For the purposes of this subsection:

1. "Prosthetic and orthopedic appliances" means any apparatus, instrument, device, or equipment used to replace or
   substitute for any missing part of the body, to alleviate the malfunction of any part of the body, or to assist any
   disabled person in leading a normal life by facilitating such person's mobility. Such apparatus, instrument, device, or
   equipment shall be exempted according to an individual prescription or prescriptions written by a physician licensed
   under chapter 458, chapter 459, chapter 460, chapter 461, or chapter 466, or 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....
   (f) Sales of drugs to or by physicians, dentists, veterinarians, and hospitals in connection with medical treatment are
   exempt.
   Rule 12A-1.021, F.A.C., dealing with prosthetic and orthopedic appliances, provides in part:
   (1)(a) Prosthetic and orthopedic appliances are exempt. The term "prosthetic and orthopedic appliances" means any
   apparatus, instrument, device, or equipment used to replace or substitute for any missing part of the body, used to
   alleviate the malfunction of any part of the body, or used to assist any disabled person in leading a normal life by
   facilitating such person's mobility. Such apparatus, instrument, device, or equipment shall be exempted according to

an individual prescription or prescriptions written by a duly licensed practitioner authorized by the laws of the state to
prescribe medicinal drugs, or 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.
(b) The prosthetic and orthopedic appliances listed below are specifically exempt:...
...
Catheters
...
Rule 12A-1.002(1), F.A.C., provides:
(1) All licensed practitioners of the healing arts are the consumers of the various items of tangible personal property
which they use in the rendition of their professional services and the tax will apply upon their purchases of items of
tangible personal property, including equipment except such items as are exempt under Rule 12A-1.020, F.A.C.
Rule 12A-1.020, F.A.C., provides, in part:
(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.
   DISCUSSION AND CONCLUSION
   Medical products dispensed to a patient pursuant to a doctor's prescription or orders are generally exempt from tax.
   (See Section 212.08(2)(a), F.S.) Included in this category are one-time use medical devices dispensed on behalf of or
   for the benefit of a patient when the medical devices 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 physician [or
   other licensed and authorized healthcare practicioner]." Additionally there are exemptions for specific products, such

as catheters, regardless of whether they are sold to a healthcare provider or to a patient. (See Rule 12A-1.021, F.A.C)
The sales of drugs, including pain medications, to or by physicians are specifically exempt from tax. (See Section
212.08(2)(f), F.S.)
Since the Pain Pump is to be dispensed to the patient by a licensed physician, the product would be exempt from tax
when purchased by the physician or clinic. It should be noted that any purchase of reusable pain pumps where
ownership of the pain pump will not be transferred to the patient would be taxable to the healthcare provider.
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 #25661