Were microwave equipment and single-use catheters used in prescribed prostate treatment exempt Kansas prosthetic devices?

Plain-English summary

The single-use catheters qualified as exempt prosthetic devices, but the external microwave equipment did not.

The business supplied equipment and catheters for a urologist-prescribed treatment for prostate enlargement. A catheter was inserted through the urethra, and microwave energy applied through it heated diseased tissue so the prostate could shrink toward normal size and function.

K.S.A. 79-3606(r) exempted prescribed prosthetic devices. The quoted definition covered a corrective or supportive device worn on or in the body to replace a missing body part, prevent or correct a deformity or malfunction, or support a weak or deformed body part.

The Department drew the line at where and how each item functioned:

• The catheter, installed in the body and used in the corrective treatment, qualified as a prosthetic device. Its purchase was exempt.
• The microwave equipment did not fit the prosthetic-device definition. Its purchase remained taxable.

What this means for you

Medical-device suppliers

Classify each component separately. Equipment used to operate a treatment is not automatically exempt merely because a connected disposable device qualifies.

Clinics and urologists

Keep the written prescription and product-use documentation showing that the device is worn on or in the body and performs the statutory corrective or supportive function.

Purchasing teams

Do not apply one exemption decision to an entire treatment system. The ruling reached opposite results for the external equipment and the in-body catheter.

Common questions

Q: Was the microwave equipment exempt?
A: No.

Q: Were the single-use catheters exempt?
A: Yes, because they were installed in the body and qualified as corrective prosthetic devices under the stated treatment facts.

Q: Did prescription matter?
A: Yes. The statute quoted by the ruling applied to prosthetic devices prescribed in writing by a licensed healing-arts professional.

Q: Did every component of the therapy receive the same treatment?
A: No. The Department analyzed the equipment and catheter separately.

Citations and references

• K.S.A. 79-3606(r) — prescribed prosthetic-device exemption and definition

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: P-2004-053

Original ruling text

Private Letter Ruling

Body:

Office of Policy & Research

October 19, 2004

XXXX
XXXX
XXXX

Re: Private Letter Ruling Request

Dear XXXX:

You indicate that your business provides microwave equipment and catheters used in treating prostate enlargement by a urologist, who prescribes the treatment, known as Cooled ThermoTherapy ™. The treatment involves installation of a catheter (which is used only once) in the body through the urethra. Microwave energy is then applied via the catheter to the prostate, heating the diseased areas, so the diseased tissue shrinks, enabling the prostate to resume normal size and function. You have asked whether the microwave equipment and catheters used in this treatment would be exempt from sales tax as “prosthetic devices” under K.S.A. 79-3606(r), which provides:

all sales of prosthetic devices . . . prescribed in writing by a person licensed to practice the healing arts, dentistry or optometry. For the purposes of this subsection: . . . (2) "prosthetic device" means a replacement, corrective or supportive device including repair and replacement parts for same worn on or in the body to artificially replace a missing portion of the body, prevent or correct physical deformity or malfunction or support a weak or deformed portion of the body.

Please be advised that the purchase of the microwave equipment would not fall within the definition of a “prosthetic device” and would not be exempt from sales tax under K.S.A. 79-3606(r). The catheters, installed in the body and used as described above in the treatment of the enlarged prostate, would qualify as prosthetic devices and purchases thereof would be exempt from sales tax under K.S.A. 79-3606(r).

If you have additional questions, please contact me. This is a private letter ruling and is based solely on the facts provided in your request. If it is determined that undisclosed facts were material or necessary to make an accurate determination by the department, this ruling is null and void. This private letter ruling will be revoked in the future by operation of law without further department action if there is a change in the statutes, administrative regulations, or case law, or a published revenue ruling, that materially affects this private letter ruling.

Very truly yours,

Richard L. Cram

Date Composed: 10/19/2004 Date Modified: 10/19/2004

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