INDIANAPOLIS A dispute over the new health care law's tax hike on medical device-makers became a proxy last week for the larger philosophical differences between Indiana's two U.S. Senate hopefuls.

It started when the Republican candidate, state Treasurer Richard Mourdock, said at a stop in Churubusco, Ind., that the tax increase is a "terrible thing that threatens jobs" and linked it to the Democratic candidate, U.S. Rep. Joe Donnelly.

Donnelly's camp then responded by accusing Mourdock of distorting the three-term congressman's record. He supported the health care law, but opposed the medical device tax hike and has worked to repeal that portion.

If you're grading the truthfulness of their arguments, both Mourdock and Donnelly get partial credit.

Had Donnelly and some of his conservative Democratic colleagues such as former U.S. Rep. Brad Ellsworth, who was hammered over this issue in his failed 2010 U.S. Senate campaign, not voted for the health care law in the first place, the medical device tax would not exist.

The 2.3 percent excise tax on sales above $5 million for medical device-makers was expected to raise about $30 billion over a decade an important step toward footing the law's price tag for a major Medicaid expansion and more.

However, Donnelly's been a vocal critic of the tax, which would put the pinch on areas like Warsaw, Ind., that are known as industry hubs. He cites it as the top example of how the health care law needs "fixing."

And he's done something about it. Donnelly co-sponsored a measure approved by the House Ways and Means Committee on Thursday that would repeal the tax.

Thus, Indiana Democratic Party spokesman Ben Ray hit Mourdock on Friday over his criticism of Donnelly.

"This attack is dishonest, and it's exactly what's wrong with Richard Mourdock's 'my way or the highway' mentality. Joe Donnelly is working with both Republicans and Democrats to repeal the medical device tax, something that wouldn't be possible if he played by Mourdock's rules," Ray said.

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Medical device tax becomes proxy for philosophical dispute between U.S. Senate candidates