Do a medical device company's bone growth stimulation devices qualify for Illinois's 1% reduced sales tax rate as 'medical appliances,' or are they taxed at the general 6.25% rate?

Plain-English summary

A medical device company asked the Illinois Department of Revenue whether its bone growth stimulation devices -- sold under redacted product names and using either combined magnetic field (CMF) electromagnetic technology or low-intensity pulsed ultrasound (LIPUS) technology -- qualify as tax-exempt-rate "medical appliances" for purposes of Illinois's Retailers' Occupation Tax. The taxpayer argued at length, with supporting clinical literature, that these devices "directly substitute" for the body's malfunctioning bone-healing signaling processes (similar to how a pacemaker substitutes for a malfunctioning heart), and should therefore be taxed at the state's preferential 1% medical-appliance rate instead of the general 6.25% merchandise rate.

The Department disagreed with the taxpayer's position. Under 86 Ill. Adm. Code 130.311(e), a "medical appliance" is an item that directly substitutes for a malfunctioning part of the human body -- things like pacemakers, artificial limbs, dental prosthetics, dialysis machines, and orthopedic braces. The Department drew a line between devices that substitute for a body part and devices that are used to treat, diagnose, or rehabilitate a condition. Diagnostic tools (like x-ray machines) and treatment/rehabilitation devices (like TENS, NMES, and sEMG stimulation units, per a prior Department ruling) fall on the taxable side of that line, per 86 Ill. Adm. Code 130.310(c)(2) and 130.311(e)(5).

Applying that framework, the Department concluded that the taxpayer's bone growth stimulation devices are used for treatment purposes -- they stimulate the body's own healing process rather than substituting for a body part the way a pacemaker or dialysis machine does. As a result, the devices do not qualify as medical appliances eligible for the 1% rate and must instead be taxed at the general merchandise state rate of 6.25%, plus any applicable local taxes.

Because this is a Private Letter Ruling, it is binding on the Department only as to this specific (redacted) taxpayer and only to the extent the facts it described are accurate and complete. It reflects the Department's reasoning on this issue but cannot be relied on by other taxpayers selling similar or different medical devices.

What this means for you

Medical device sellers

If you sell devices marketed for treating, healing, or rehabilitating a condition -- rather than devices that physically substitute for a missing or non-functioning body part -- Illinois will likely tax them at the general 6.25% merchandise rate, not the 1% medical-appliance rate, even if the device is FDA Class III, prescription-only, and reimbursed by Medicare. FDA classification and medical necessity do not, by themselves, establish "medical appliance" status under Illinois sales tax rules.

Accountants and tax professionals preparing sales tax positions

The Department's key distinction is "direct substitution for a malfunctioning body part" (qualifies, per 130.311(e)) versus "treatment, diagnosis, or rehabilitation" (does not qualify, per 130.310(c)(2) and 130.311(e)(5)). When advising a client on whether a device qualifies for the reduced rate, look for whether the device replaces a missing/failed body part's basic function (like a pacemaker or dialysis machine) versus stimulates or supports the body's own repair process (like the bone growth stimulators here, or TENS/NMES/sEMG units cited in ST 98-0157-GIL).

Businesses currently billing at the full rate

The taxpayer in this ruling was already billing its devices at the full Illinois Retailers' Occupation Tax rate before requesting the PLR. This ruling confirms that continuing to bill bone growth stimulators (of the CMF and LIPUS types described) at the general 6.25% rate is consistent with the Department's position -- taxpayers selling comparable devices should not assume the 1% rate applies without their own analysis or ruling request.

Common questions

Q: Did the Department agree with the taxpayer that bone growth stimulators are medical appliances?
A: No. The taxpayer argued extensively (citing clinical and pre-clinical studies) that its devices should qualify, but the Department's actual holding is the opposite: the devices are used for treatment purposes and do not qualify as medical appliances eligible for the 1% rate.

Q: What tax rate applies instead?
A: The general merchandise state rate of 6.25%, plus any applicable local Retailers' Occupation Tax, rather than the 1% rate that applies to qualifying drugs, medicines, and medical appliances.

Q: Why doesn't a bone growth stimulator count as a medical appliance the way a pacemaker does?
A: Under 86 Ill. Adm. Code 130.311(e), a medical appliance directly substitutes for a malfunctioning body part. The Department treated bone growth stimulators as treatment/rehabilitation devices that help the body heal itself, which places them alongside diagnostic and treatment devices like TENS, NMES, and sEMG units that the Department has previously excluded from the reduced rate (see ST 98-0157-GIL), rather than alongside substitutive devices like pacemakers or dialysis machines.

Q: Can other medical device companies rely on this ruling for their own products?
A: No. This is a Private Letter Ruling binding on the Department only as to the specific (redacted) taxpayer and the specific facts described in the request. Other taxpayers can look to it for the Department's reasoning, but must request their own PLR or GIL to get a binding answer for their own products.

Q: Does FDA classification or Medicare reimbursement matter to the analysis?
A: The taxpayer raised the devices' FDA Class III status (the same classification as pacemakers) and Medicare reimbursement as support for its position, but the Department's response does not rely on FDA classification or insurance coverage -- it applies the Illinois-specific "direct substitute for a malfunctioning body part" test from 86 Ill. Adm. Code 130.311(e) and finds the devices fall short of it.

Citations and references

• 35 ILCS 120/2 (Retailers' Occupation Tax imposed on sellers of tangible personal property)
• 35 ILCS 105/3 (Use Tax imposed on the privilege of using tangible personal property purchased at retail)
• 86 Ill. Adm. Code 130.311 (taxation of drugs, medicines, medical appliances, and grooming/hygiene products)
• 86 Ill. Adm. Code 130.311(e) (definition of medical appliance -- direct substitute for a malfunctioning body part)
• 86 Ill. Adm. Code 130.311(e)(1)-(2) (examples of qualifying medical appliances)
• 86 Ill. Adm. Code 130.311(e)(5) (tools/devices used in treatment but not directly substituting do not qualify)
• 86 Ill. Adm. Code 130.310(c)(2) (diagnostic, treatment, and rehabilitative equipment does not qualify for reduced rate)
• ST 98-0157-GIL (prior Department guidance excluding TENS, NMES, and sEMG treatment devices from the reduced rate)

Source

• Landing page: https://taxarchive.illinois.gov/research/legal/letter-rulings/sales-tax/2025.html
• Original PDF: https://tax.illinois.gov/content/dam/soi/en/web/taxarchive/research/legal/letter-rulings/sales-tax/2025/st25-0005-plr.pdf

Original ruling text

ST 25-0005-PLR 09/05/2025 MEDICAL APPLIANCES
A medical appliance is an item that is used to directly substitute for a malfunctioning
part of the human body. Bone growth stimulation devices are used for treatment
purposes and do not qualify as medical appliances eligible for the 1% rate. See 86
Ill. Adm. Code 130.311(e). (This is a PLR).
September 5, 2025
NAME
COMPANY
ADDRESS
EMAIL
Dear NAME:
This letter is in response to your letter dated May 6, 2025, in which you requested
information. The Department issues two types of letter rulings. Private Letter Rulings
(“PLRs”) are issued by the Department in response to specific taxpayer inquiries concerning
the application of a tax statute or rule to a particular fact situation. A PLR is binding on the
Department, but only as to the taxpayer who is the subject of the request for ruling and only
to the extent the facts recited in the PLR are correct and complete. Persons seeking PLRs
must comply with the procedures for PLRs found in the Department’s regulations at 2 Ill.
Adm. Code 1200.110. The purpose of a General Information Letter (“GIL”) is to direct
taxpayers to Department regulations or other sources of information regarding the topic
about which they have inquired. A GIL is not a statement of Department policy and is not
binding on the Department. See 2 Ill. Adm. Code 1200.120. You may access our website at
https://tax.illinois.gov/ to review regulations, letter rulings and other types of information
relevant to your inquiry.
Review of your request disclosed that all the information described in paragraphs 1
through 8 of Section 1200.110 appears to be contained in your request. This Private Letter
Ruling will bind the Department only with respect to COMPANY, for the issue or issues
presented in this ruling, and is subject to the provisions of subsection (e) of Section
1200.110 governing expiration of Private Letter Rulings. Issuance of this ruling is
conditioned upon the understanding that neither COMPANY, nor a related taxpayer is
currently under audit or involved in litigation concerning the issues that are the subject of
this ruling request. In your letter you have stated and made inquiry as follows:
Pursuant to 2 Ill. Admin. Code § 1200.110, COMPANY respectfully requests a
Private Letter Ruling on whether its bone growth stimulation devices,
including the DEVICE, DEVICE1, and DEVICE2, qualify as non-taxable
"medical appliances" under Illinois law.

COMPANY/NAME
Page 2
September 5, 2025
Issue
1.
2.
3.

Does COMPANY’s sales of bone growth stimulation devices qualify
for the state’s medical appliance reduced tax rate?
Do bone growth stimulation devices meet the definition of Illinois’s
medical appliance definition?
Currently COMPANY is billing the medical device at the full Illinois
Retailer’s Occupational tax.

We affirm that this matter is not currently being audited, litigated, or otherwise
addressed by the Department of Revenue and that the request pertains to a
specific, actual situation of the requesting taxpayer.
Statement of Facts
COMPANY, is a global provider of orthopedic medical technologies. The
company’s DIVISION division specializes in the treatment of non-healing
bone fractures and fusions, including those of the spine. These conditions
reflect a physiological malfunction in the body’s bone repair systems, both at
the cellular and bioelectrical level. When a bone fails to heal and a nonunion
forms, this reflects not merely a delay in healing but a fundamental
malfunction of the body’s repair system at the cellular and biophysical
levels.1,2,3,4
I. The Normal Bone Healing Process1,5,6,7
Bone healing is a complex, tightly regulated biological process that under
normal conditions progresses through three overlapping phases. Each of
these phases relies on precise cellular communication, molecular signaling,
and biophysical mechanisms, particularly the body’s innate piezoelectric
properties.
A. Bone Healing Phases
Each of the three phases of bone healing requires precise cell signaling,
vascular support, and mechanosensory feedback to proceed. Each phase
relies on mesenchymal stem cell recruitment, angiogenesis,
osteoblast/chondrocyte function, and piezoelectric signaling from
mechanical loading. Phases and the associated timeline post-injury are
shown herein:

COMPANY/NAME
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• Inflammation Phase (Initial days post-injury)
• Repair Phase (Days to Weeks)
• Remodeling Phase (Months to Years)
B. Piezoelectric Currents
Bone is piezoelectric, meaning it generates electric potentials in response to
mechanical stress due to the crystalline structure of its collagen fibers. These
bioelectric signals serve critical functions in bone healing. Under normal
conditions, mechanical loading (e.g., walking, movement) generates
piezoelectric currents that activate and direct repair processes. These
currents are integral, not supplemental, to bone healing and the phases
outlined above:
• Stimulate osteoblastic activity
• Promote cellular migration and differentiation
• Guide bone remodeling and callus formation
II. Malfunction at the Cellular & Bioelectrical Levels Leads to
Nonunion6,8,9,10
A nonunion, typically defined as a fracture that fails to heal within 6–9 months,
reflects a systematic failure in cellular coordination and bioelectrical
signaling. Specific details are shown in the table below, illustrating the
biologic malfunction behind nonunion:
FAILED
PROCESS
MSC
Recruitment

UNDERLYING
CAUSE
Poor blood flow
or inflammation

Angiogenesis

Disrupted VEGF
signaling (e.g,
ischemia,
diabetes)
Impaired
chondrogenesis
Toxic
inflammation,
smoking,
NSAIDS
Chronic
inflammation

Chondrocyte
Function
Osteoblast
Activity
Osteoclast
Overactivity

CELLULAR
CONSEQUENCE
Insufficient
chondrocyte/osteoblast
formation
Poor vascular support

Weak Callus formation
Poor bone matrix
deposition
Premature resorption

COMPANY/NAME
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September 5, 2025
Chronic
Inflammation

M1
macrophage
dominance

Persistent catabolic
state

In nonunion, there is a complete absence of piezoelectric signaling, often due
to immobility or lack of mechanical loading, chronic inflammation or ischemia
disrupting collagen structure, and systemic factors like diabetes or infection
impairing signal transduction.
The consequences of disrupted piezoelectric currents include:
• Reduced recruitment and activation of osteoblasts
• Impaired mineralization and tissue remodeling
• Replacement of bone with fibrous, non-functional tissue
III. Clinical Recognition11,12,13,14
The medical community recognizes this malfunction through the use of
electrical stimulation therapies which mimic and thus, “replace” the
malfunctioning piezoelectric currents. These technologies serve as an
external replacement for what the body is unable to do based on the
malfunctions identified above. These interventions are not experimental, they
are supported by published pre-clinical and clinical evidence, deemed
medically necessary and are covered by major health insurance plans, such
as Medicare. These technologies are standard of care in cases of impaired
healing, precisely because the body’s natural signaling system has failed.
Without such intervention, nonunion may be considered chronic, may result
in amputation, or need significant surgical intervention.
Nonunion is not a passive delay in healing, it is a pathological state arising
from multi-systemic failure, including breakdowns in cellular behavior,
inflammatory regulation, vascularization, and bioelectrical signaling. The
absence or dysfunction of piezoelectric currents further reinforces the
conclusion that a nonunion is a clear instance of the body malfunctioning at
both biological and electrical levels. A nonunion is a failure of the body’s
natural repair mechanisms, justifying medical, rehabilitative, and possibly
legal intervention.
IV. Bone Growth Stimulation as a Means of Replacing Malfunctioning
Systems in the Body15,17,18,19,20
By mimicking endogenous piezoelectric currents and/or generating
mechanical stresses and triggering the same biochemical cascade, bone
growth stimulation therapy, inclusive of all FDA approved electromagnetic

COMPANY/NAME
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September 5, 2025
and electric technologies, corrects a physiological deficit, addressing not
just symptoms but the root cause of nonunion. It is therefore medically and
legally justifiable to characterize such stimulation therapy (and the devices
that deliver the therapy) as a biophysical substitute for failed cellular and
electrical mechanisms in bone healing.
A. Combined Magnetic Field (CMF™) Inductive Coupling Electromagnetic
Stimulation
COMPANY offers two products that deliver CMF™ technology, the DEVICE and
DEVICE1. Extensive pre-clinical and cellular data has been published
detailing how this technology replaces malfunctioning cellular pathways
required for successful bone healing.
In the landmark 2001 study by Brighton et al., researchers showed that CMF
therapy significantly increased osteoblast proliferation via intracellular signal
transduction. CMFs stimulate the release of calcium (Ca²⁺) from intracellular
stores, raising cytosolic Ca²⁺ concentrations. This activates calmodulin, a key
regulator of nucleotide synthesis and cell proliferation. CMFs bypass
dysfunctional mechanotransduction by emulating piezoelectric currents,
thereby reinitiating halted bone formation processes. Taken directly from the
publication: "Combined electromagnetic fields... led to an increase in
cytosolic Ca²⁺ and activated cytoskeletal calmodulin," directly correlating
with enhanced DNA synthesis and bone cell proliferation. CMFs result in a 21–
30% increase in DNA synthesis in bone cells over control, even without
mechanical loading. The proliferative effect is mediated through the same
final signaling pathway used by physiological strain: cytosolic Ca²⁺ →
calmodulin activation → bone formation.15
Additional pre-clinical and cellular data has been provided to further support
how this technology replaces malfunctioning cellular pathways required for
successful bone healing.
Author
Brighton
, Carl T.,
et al.

Citation & Web Link
"Signal Transduction in
Electrically Stimulated Bone
Cells." The Journal of Bone and
Joint Surgery. American
Volume, vol. 83, no. 10, 2001,
pp. 1514–1523. Link to
Publication

Summary
Demonstrates
that combined
electromagneti
c fields
increase
cytosolic
calcium and
calmodulin
activity in

COMPANY/NAME
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September 5, 2025

Aaron,
Roy K.,
et al.

Kaadan, A.; Salati, S.; Setti,
S.; Aaron, R. Augmentation of
Deficient Bone Healing by
Pulsed
Electromagnetic Fields From
Mechanisms to Clinical
Outcomes.
Bioengineering 2024, 11, 1223.
Link to Publication

Yang,
Xu, et al.

Yang, Xu et al. “Callus
mineralization and maturation
are delayed during fracture
healing in interleukin-6
knockout mice.” Bone vol. 41,6
(2007): 928-36.
doi:10.1016/j.bone.2007.07.02
2
Link to Publication

Ryaby,
James T.

"Clinical Effects of
Electromagnetic and Electric
Fields on Fracture
Healing." The Journal of Bone
and Joint Surgery. American
Volume, vol. 83, no. 10, suppl.
2, 2001, pp. 143–151.
Link to Publication

osteoblasts,
directly
enhancing DNA
synthesis and
cell
proliferation.
A pre-clinical
animal study
showing that
CMF increases
bone formation
in areas of
stress
shielding,
suggesting
stimulation of
osteogenic
pathways.
An in vivo study
in rats revealing
that CMF
exposure
accelerates
callus
maturation,
increases
mineral
apposition, and
modulates
gene
expression
related to
osteogenesis.
Although
largely clinical,
this review
incorporates
data from
several animal
and in vitro
studies
showing CMF

COMPANY/NAME
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September 5, 2025
increases in
osteoblast
proliferation,
matrix
synthesis, and
bone healing
rate.
Clinical data further supports the effectiveness of CMF™ technology in
replacing malfunctioning cellular pathways. In a study reviewed by FDA to
approve CMF™ technology as safe and effective for the first time, patients with
chronic nonunion were evaluated. The data was later published (Baumhauer).
Patients had underwent, on average, 2.5 prior surgical interventions with a
mean time since injury of 29.3 months. Patients had received no intervention
for at least three months prior to the start of stimulation. A clinically
significant outcome of 60.7% overall was achieved with 73.6% of all fractures
less than two years old healing successfully and 75.6% of tibia fractures
healing successfully. Additionally, 100% of the fractures were still healed 3
months post-treatment. This is clinically significant because many of the
nonunions in this study were destined to undergo one or more additional
surgical interventions, possible amputations, along with continuing disability
and pain.22
B. Low Intensity Pulsed Ultrasound Stimulation (LIPUS)
COMPANY offers it’s newly FDA approved DEVICE2™ device designed to
deliver LIPUS technology for the treatment of nonunion fracture. LIPUS emits
pulsed ultrasound waves that generate nano-scale mechanical stresses at
the fracture site. These stresses are detected by integrin receptors on bone
cells, initiating intracellular signaling cascades that promote osteogenesis.
Additionally, LIPUS induces acoustic streaming, enhancing fluid movement
around cells, which increases nutrient and signaling molecule exchange,
further supporting bone regeneration.23
Upon mechanical stimulation by LIPUS, integrins activate focal adhesion
kinase (FAK), leading to the upregulation of cyclooxygenase-2 (COX-2) and
subsequent production of prostaglandin E2 (PGE2). PGE2 plays a crucial role
in bone healing by promoting osteoblast differentiation and
mineralization. This pathway mirrors the body's natural response to
mechanical loading, effectively compensating for its absence in cases like
immobilization or nonunion fractures.24

COMPANY/NAME
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September 5, 2025
LIPUS stimulates the expression of vascular endothelial growth factor (VEGF),
promoting angiogenesis at the fracture site. This increased blood vessel
formation improves oxygen and nutrient delivery, essential for tissue
regeneration. Moreover, LIPUS encourages mesenchymal stem cells to
differentiate into osteoblasts and chondrocytes, facilitating the formation of
new bone and cartilage.24
By emulating the mechanical and biochemical cues of natural bone healing,
LIPUS serves as a non-invasive therapeutic option to stimulate bone repair,
especially in scenarios where the body's healing processes are
compromised. Its ability to activate key signaling pathways and promote
cellular activities underscores its role as a functional replacement for
impaired biological mechanisms in bone regeneration.
Clinical data further supports the information provided. In a study published
in 2015, heal rate for chronic (>1 year) nonunion patients (N=767) treated with
LIPUS was 86.2%. Heal rate was 82.7% among 98 patients with chronic
nonunion ≥5 years duration, and 12 patients healed after chronic nonunion

10 years (HR=63.2%).25
V. Regulatory Classification and Prescribing Requirements26,27,28,29
Bone growth stimulation devices, commonly referred to as an osteogenesis
stimulator, DEVICE1, DEVICE, and DEVICE2™ are provided by prescription
only, on a single-patient-use basis, by COMPANY, to patients whose fractures
or spinal fusions are not healing properly after documented injury or surgery.
These devices emit low-level electrical pulses that stimulate bone healing,
triggering cellular processes that are necessary for bone regeneration. This
mechanism mimics the natural electrical signals produced by the body during
normal bone healing, which in these patient populations, is insufficient to heal
the bone effectively on its own.
Bone growth stimulators are classified as Class III FDA medical devices, the
same classification as heart pacemakers. Class III devices are those that
pose the highest risk to patient safety and are subject to the most rigorous
regulatory oversight, including pre-market approval (PMA) processes. This
classification is reserved for devices that play critical roles in restoring or
maintaining bodily function and, as such, must meet strict safety and
efficacy standards before they can be marketed to the public.
Patients that undergo treatment with a bone growth stimulator are required to
adhere to a strict daily use schedule. The DEVICE and DEVICE1 are worn by

COMPANY/NAME
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September 5, 2025
patients for 30 minutes per day. The DEVICE2™ is worn by patients for 20
minutes per day. Each device is equipped with a monitoring program that
displays patient use information that may be accessed by the physician.
Patients are trained by the physician or company representative to ensure
proper placement of the device directly over the site of the injury. Patients
may utilize a single device for up to nine (9) months or until the prescribing
physician deems them successfully healed.
Links to the product Information for Use (IFU) as per the FDA have been
included:
• DEVICE: LINK
• DEVICE1:LINK1
• DEVICE2: LINK2
The alternative to using such devices, in many instances, is surgical
intervention. Many patients with conditions such as those noted by the AAOS
are poor candidates for surgical intervention making treatment with bone
growth stimulation their only viable option for healing. In some instances,
injuries are deemed traumatic enough for physicians to utilize bone growth
stimulation in addition to surgical intervention.
Similar to pacemakers, which regulate heart rhythm, bone growth
stimulators are critical in addressing a malfunctioning body part,
specifically, bones that cannot heal on their own. These devices are
reimbursable by the Centers for Medicare and Medicaid Services (CMS) for
the treatment of nonunion fractures, failed fusions, or high-risk spinal
fusions.4 Other examples of Class III medical devices that qualify as medical
appliances include:
• Artificial Limbs: Substitutes for lost limbs due to trauma or congenital
defects
• Dental Prosthetics: Replace missing or damaged teeth
• Breast Implants: Restore breast tissue after mastectomy
• Dialysis Machines: Replace kidney function in patients with renal failure
• Orthopedic Braces and Crutches: Support and stabilize bones and joints
during recovery
VI. Conclusion of Taxpayer’s View
After reviewing the definition of medical appliance under Illinois tax law
section 130.311, COMPANY opinion is that bone growth stimulators directly
substitute for or support a malfunctioning part of the body, fulfilling the

COMPANY/NAME
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requirements of a medical appliance under both FDA regulation and Illinois
tax law Section 130.311.
VII. Supporting Information
Supporting Documents
Attached herein are copies of all relevant contracts, licenses, agreements,
instruments, or other documents related to the request. These documents
provide a full and accurate representation of the transaction.
VIII. References
1.

Carter, Amber et al. “Enhancement of Bone Regeneration Through
the Converse Piezoelectric Effect, A Novel Approach for Applying
Mechanical Stimulation.” Bioelectricity vol. 3,4 (2021): 255-271.
doi:10.1089/bioe.2021.0019 Link to Publication

2. Boden, S. D., & Rosenthal, R. K. (2020). Fracture nonunion.
   In StatPearls. StatPearls Publishing. Link to Publication
3. J. Sun, W. Xie, Y. Wu, Z. Li, Y. Li, Accelerated Bone Healing via
   Electrical Stimulation. Adv. Sci. 2024, 2404190. Link to Publication
4. Ding, Zi-Chuan et al. “Molecular pathogenesis of fracture
   nonunion.” Journal of orthopaedic translation vol. 14 45-56. 31 May.
   2018, doi:10.1016/j.jot.2018.05.002 Link to Publication
5. Kalfas, Ioannis H. "Principles of Bone Healing." Neurosurgical
   Focus, vol. 10, no. 4, 2001, p. E1. Link to Publication.
6. Gómez-Barrena, Enrique, et al. "Bone Fracture Healing: Cell
   Therapy in Delayed Unions and Nonunions." Bone, vol. 70, 2015, pp.
   93–101. Link to Publication
7. Marsell, Richard, and Thomas A Einhorn. “The biology of fracture
   healing.” Injury vol. 42,6 (2011): 551-5.
   doi:10.1016/j.injury.2011.03.031Link to Publication
8. Giannoudis, Peter V., et al. "Fracture Healing in Osteoporotic
   Fractures: Is It Really Different? A Basic Science
   Perspective." Injury, vol. 38, no. 1, 2007, pp. S90–S99. Elsevier, Link
   to Publication
9. Raggatt, L. J., and N. C. Partridge. "Cellular and Molecular
   Mechanisms of Bone Remodeling." Journal of Biological Chemistry,
   vol. 285, no. 33, 2010, pp. 25103–25108. Link to Publication.
10. Maruyama, Masahiro et al. “Modulation of the Inflammatory
    Response and Bone Healing.” Frontiers in endocrinologyvol. 11 386.
    11 Jun. 2020, doi:10.3389/fendo.2020.00386 Link to Article

COMPANY/NAME
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September 5, 2025

11. Aaron, Roy K., and Carl T. Brighton. "Current Concepts Review:
    Electrical and Electromagnetic Stimulation of Fracture
    Healing." The Journal of Bone and Joint Surgery. American Volume,
    vol. 81, no. 11, 1999, pp. 1670–1678.
12. Bassett, Colin A. L., et al. "Use of Pulsing Electromagnetic Fields in
    the Treatment of Ununited Fractures and Failed Arthrodeses." The
    Journal of the American Medical Association (JAMA), vol. 243, no.
    10, 1980, pp. 1045–1049. Link to Publication
13. Mollon, Brent et al. “Electrical stimulation for long-bone fracturehealing: a meta-analysis of randomized controlled trials.” The
    Journal of bone and joint surgery. American volume vol. 90,11
    (2008): 2322-30. doi:10.2106/JBJS.H.00111 Link to Publication
14. Griffin, Xavier L., et al. "Electromagnetic Field Stimulation for
    Treating Delayed Union or Non-union of Long Bone Fractures in
    Adults." Cochrane Database of Systematic Reviews, no. 4, 2011,
    Art. No.: CD008471. Link to Publication.
15. Brighton, Carl T., et al. "Signal Transduction in Electrically
    Stimulated Bone Cells." The Journal of Bone and Joint Surgery.
    American Volume, vol. 83, no. 10, 2001, pp. 1514–1523. Link to
    Article
16. Claes, Lutz, and Christiane W. Wilke. "Effects of Mechanical and
    Biophysical Stimuli on the Fracture Healing Process." Clinical
    Orthopaedics and Related Research, vol. 355, 1998, pp. S132–S147.
    Link to Publication
17. Pilla, A A et al. “Non-invasive low-intensity pulsed ultrasound
    accelerates bone healing in the rabbit.” Journal of orthopaedic
    trauma vol. 4,3 (1990): 246-53. doi:10.1097/00005131-19900403000002 Link to Publication
18. Duarte, Luis R. "The Stimulation of Bone Growth by
    Ultrasound." Archives of Orthopaedic and Traumatic Surgery, vol.
    101, no. 3, 1983, pp. 153–159. Link to Publication
19. Hadjiargyrou, Michael, and Daniel M. O'Keefe. "The Convergence of
    Fracture Repair and Stem Cells: Interplay Between Mechanical,
    Inflammatory, and Angiogenic Signals." Bone, vol. 90, 2016, pp. 38–
20. Link to Publication
21. U.S. Food and Drug Administration. "Premarket Approval (PMA) for
    DEVICE Bone Growth Stimulator." FDA.gov, Link to Information
22. Phillips, Mark et al. “The Use of Combined Magnetic Field Treatment
    for Fracture Nonunions: A Prospective Observational
    Study.” Journal of long-term effects of medical implants vol. 26,3
    (2016): 261-270.

COMPANY/NAME
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doi:10.1615/JLongTermEffMedImplants.2016016816 Link to
Publication

22. Haocheng Qin et al., The Therapeutic Effect of Low Intensity Pulsed
    Ultrasound in musculoskeletal soft tissue injuries: Focusing on the
    molecular mechanism. Bioeng. Biotechnol., 15 December 2022
    Sec. Biomaterials Volume 10 - 2022 | Link to Publication
23. Palanisamy P, Alam M, Li S, Chow SKH, Zheng YP. Low-Intensity
    Pulsed Ultrasound Stimulation for Bone Fractures Healing: A
    Review. J Ultrasound Med. 2022 Mar;41(3):547-563. doi:
    10.1002/jum.15738. Epub 2021 May 5. PMID: 33949710; PMCID:
    PMC9290611. Link to Publication
24. Zura, Robert et al. “Treatment of chronic (>1 year) fracture
    nonunion: heal rate in a cohort of 767 patients treated with lowintensity pulsed ultrasound (LIPUS).” Injury vol. 46,10 (2015): 203641. doi:10.1016/j.injury.2015.05.042 Link to Publication
25. DEVICE Information for Use Document – LINK3
    https://enovis.com/sites/default/files/132109_OL1000_family_RevA.pdf
26. DEVICE1 Information for Use Document - LINK4
27. DEVICE2 Information for Use Document - ATTACHED
28. FDA Classification of Osteogenesis Stimulator devices:
    https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfPCD/classi
    fication.cfm?id=5091
    Tax Period at Issue
    The tax period at issue is 04/21/2022 – 04/21/2025. Furthermore, there is no
    litigation or audit pending.
    Prior Rulings
    To the best of the knowledge of both the taxpayer and the taxpayer’s
    representative, the Department has not previously issued a ruling on the same
    or a similar issue for the taxpayer or a predecessor.
    Authorities Contrary to the Taxpayer’s Views
    To the best of our knowledge, there are no authorities contrary to our views.
    If the Department determines there are contrary authorities, we request the
    opportunity to address them.
    Request for Deletion of Trade Secret Information

COMPANY/NAME
Page 13
September 5, 2025
We request that the following specific trade secret information be excluded
from the publicly disseminated version of the ruling: Company names:
COMPANY1 & COMPANY; Product names: DEVICE1, DEVICE, DEVICE2™.
Signature of Taxpayer or Representative
This request is made on behalf of COMPANY, and is signed by the undersigned
employee, who is duly authorized to submit this request.
We understand that private letter rulings are binding only under the current
law and facts and that they may be revoked or cease to bind the Department
in the future under certain circumstances. We also understand the
Department’s policy on the expiration and revocation of private letter rulings
as outlined in Section 4 of the Taxpayer’s Bill of Rights Act (20 ILCS 2520/4)
and related provisions.
Thank you for your consideration of this request. Should you require any
further information or documentation, please do not hesitate to contact me,
NAME, EMAIL.
DEPARTMENT’S RESPONSE:
The Illinois Retailers’ Occupation Tax Act imposes a tax upon persons engaged in this
State in the business of selling tangible personal property to purchasers for use or
consumption. 35 ILCS 120/2; 86 Ill. Adm. Code 130.101. In Illinois, Use Tax is imposed on
the privilege of using, in this State, any kind of tangible personal property that is purchased
anywhere at retail from a retailer. 35 ILCS 105/3; 86 Ill. Adm. Code 150.101.
The Department’s administrative rules found at 86 Ill. Adm. Code Section 130.311
govern the taxation of Drugs, Medicines, Medical Appliances, and Grooming and Hygiene
Products. Products that qualify as drugs, medicines, or medical appliances are taxed at a
lower State rate of 1% plus any applicable local taxes. Items that do not qualify for the low
rate of tax are taxed at the general merchandise State rate of 6.25% plus any applicable local
taxes.
A medical appliance is an item that is used to directly substitute for a malfunctioning
part of the human body. 86 Ill. Adm. Code 130.311(e). Medical appliances include such
items as heart pacemakers, artificial limbs, dental prosthetics and orthodontic braces,
crutches, dialysis machines (including the dialyzer), and wheelchairs. 86 Ill. Adm. Code
130.311(e)(1). Corrective medical appliances such as hearing aids, eyeglasses, contact

COMPANY/NAME
Page 14
September 5, 2025
lenses, and orthopedic braces also qualify as medical appliances. 86 Ill. Adm. Code
130.311(e)(2). Other medical tools, devices, and equipment such as x-ray machines,
laboratory equipment, and surgical instruments that may be used in the treatment of
patients but that do not directly substitute for a malfunctioning part of the human body do
not qualify as medical appliances. 86 Ill. Adm. Code 130. 311(e)(5).
As a general proposition, diagnostic, treatment, and rehabilitative equipment items
do not qualify for the reduced rate of tax as medical appliances because such items are not
“for use in directly substituting for a malfunctioning part of the body,” 86 Ill. Adm. Code
130.310(c)(2). Nor are such items corrective medical appliances such as hearing aids or
glasses. The Department has previously stated that items that do not qualify for the lower
rate are diagnostic items such as x-ray machines and laboratory equipment; and treatment
or rehabilitation devices such as TENS (Transcutaneous Electrical Nerve Stimulation),
NMES (Neuromuscular Electrical Stimulation), and sEMG (Surface Electromyography
Systems) devices. See ST 98-00157-GIL.
Based on the information provided, it is the Department’s opinion that COMPANY’s
products: DEVICE1, DEVICE, and DEVICE2 are used for treatment purposes and do not
qualify as medical appliances eligible for the 1% rate.
If you have further questions concerning this Private Letter Ruling, you may contact
me at (217) 782-7055. If you have further questions related to the Illinois sales tax laws,
please visit our website at https://tax.illinois.gov/ or contact the Department’s Taxpayer
Information Division at (800) 732-8866.
Very truly yours,
Samuel J. Moore
Chairman, Private Letter Ruling Committee
SJM:slc