Federal Court Legalizes Compensation For Bone Marrow Donors

A new ruling from the 9th Circuit Court of Appeals raises a host of questions.

Overturning a regulation based on a decades old law that makes compensation for such activities a crime, a Federal Court has ruled that nearly all bone marrow donors can be compensated for their donation:

SAN FRANCISCO — A federal appeals court ruled Thursday that most bone marrow donors can be paid, overturning the government’s interpretation of a decades-old law making such compensation a crime punishable by up to five years in prison.

In its ruling, the 9th U.S. Circuit Court of Appeals said a technological breakthrough makes donating bone marrow a process nearly identical to giving blood plasma.

It’s legal — and common — to pay plasma donors. Therefore, the court ruled, bone marrow donors undergoing the new procedure can be paid as well and are exempt from a law making it a felony to sell human organs for transplants.

The unanimous, three-judge panel of the court did say it remains a felony to compensate donors for undergoing an older transplant method, which extracts the marrow from the donors’ bones.

But the court said the new technology isn’t covered by the law because actual bone marrow isn’t taken from the donor. Instead, specialized cells that grow into marrow are taken from a donor’s bloodstream, and it’s basically a blood donation, not an organ transplant, the court said. It noted that two-thirds of bone marrow transplants employ the newer process.

Tens of thousands of people with leukemia, lymphoma and other blood diseases are saved each year by such procedures. An estimated three thousand others die waiting for donations, which unlike simple blood donations need to be genetically compatible, making matches especially difficult for African Americans.

Advocates for paying donors said compensation will spur even more donations. Detractors argue that donor compensation will exploit the poor to undergo risky medical procedures to benefit the wealthy.

The National Marrow Donor Program, the nonprofit that provides transplants from volunteers, opposes payments.

“We were surprised and puzzled by the appellate court’s decision regarding allowing compensation,” said Michael Boo, the program’s chief strategy officer. “The National Marrow Donor Program is studying the decision and assessing the impact. We do not anticipate the ruling will change the NMDP’s current policies and practices.”

The ruling overturns a lower court decision barring compensation for all bone marrow donations.

The ruling comes in a lawsuit that was filed by the libertarian public policy law from The Institute For Justice, which represented cancer patients, the families of children with cancer, doctors, and other organization in a lawsuit challenging the law. At that time IJ released this video featuring many of the Plaintiffs in the case:

The Cato Institute’s Ilya Shapiro sees signs that this case could lead to a reexamination of the manner in which Congress regulates organ donation to begin with:

The good news is that, with the bone marrow market effectively deregulated, Congress may now be motivated to reexamine its misguided ban on compensating organ donors. One of the greatest obstacles to reforming the prohibition on organ sales is the fortunate fact that relatively few Americans require organ transplants in any given election cycle. According to government statistics, 112,546 Americans are currently on some kind of organ transplant waiting list. That means only around 1 in 3,000 Americans (and their families and friends) would be seriously motivated to demand organ transplant reform from Congress. Congress will now be forced to grapple with its policies regarding bone marrow transplants, which may be an opportune time for advocates to push for wider organ transplant reform.

The Ninth Circuit’s opinion also clears the way for Supreme Court review of NOTA. If this case reaches the high court, IJ can press its constitutional arguments more forcefully. And even if the Supreme Court merely affirms the Ninth Circuit’s opinion on statutory grounds, we will inevitably learn much about the justices’ views on the constitutionality of NOTA more broadly.

For the moment, Flynn v. Holder means that, for the first time in over 25 years, a spotlight has been shined on NOTA and its disastrous effects on Americans’ medical liberty. And that is why the Ninth Circuit’s narrow bone marrow opinion may actually be a significant step toward the rational regulation of organ markets.

Leaving aside the much more controversial issue of compensation for organ donation for the moment, the ruling in this case seems to have been so self-evident that one wonders why the Federal Government fought so hard against it. As noted, the new procedure for extracting bone marrow is the functional equivalent of collecting a blood donation and, since the law allows people who donate blood to be compensated, there’s no logical reason why the law should be applied in a manner that prohibits compensation for a functionally identical way of donating another bodily fluid, and in this case one that could be of great aid to people suffering from many different forms of cancer.

It was this essential similarity between blood donation and the new method of bone marrow extraction, called apheresis, that was the central fact that the Court hunt its hat on in ruling on the regulation:

Congress could not have had an intent to address the apheresis method when it passed the statute, because the method did not exist at that time. We must construe the words of the statute to see what they imply about extraction of hematopoietic stem cells by this method. This issue has not been addressed by any of our sister circuits.

Since payment for blood donations has long been common, the silence in the National Organ Transplant Act on compensating blood donors is loud. “Blood” is omitted from the list of examples of “human organs” in the statute and the regulation. The statute says “human organ” is defined as a human “kidney, liver, heart, lung, pancreas, bone marrow, cornea, eye, bone, and skin or any subpart thereof and any other human organ . . . specified by the Secretary of Health and Human Services by regulation.”42 The regulation adds intestines and the rest of the gastrointestinal tract to the list: “kidney, liver, heart, lung, pancreas, bone marrow, cornea, eye, bone, skin, and intestine, including the esophagus, stomach, small and/or large intestine, or any portion of the gastrointestinal tract.”43 Neither the statute nor the regulation defines “human organ” to include “blood.” The government concedes that the common practice of compensating blood donors is not prohibited b y the statute.

The government argues that hematopoietic stem cells in the veins should be treated as “bone marrow” because “bone marrow” is a statutory organ, and the statute prohibits compensation not only for donation of an organ, but also “any subpart thereof.”44 Hematopoietic stem cells are formed in the bone marrow, and most are found there because they generally mature into blood cells and platelets in the marrow. Therefore, the government argues, they should be viewed as “subparts” of the bone marrow, even when these stem cells are obtained through apheresis, which is to say, from blood flowing through veins.

We reject this argument, because it proves too much, and  because it construes words to mean something different from ordinary usage. If the government’s argument that what comes from the marrow is a subpart of the marrow were correct,  then the statute would prohibit compensating blood donors. The red and white blood cells that flow through the veins come from the bone marrow, just like hematopoietic stem cells. But the government implicitly concedes that these red and white blood cells are not “subparts” of bone marrow under the statute, because it explicitly concedes that the statutedoes not prohibit compensation for blood donations.


It may be that “bone marrow transplant” is an anachronism that will soon fade away, as peripheral blood stem cell apheresis replaces aspiration as the transplant technique, much as “dial the phone” is fading away now that telephones do not have dials. Or it may live on, as “brief” does, even though “briefs” are now lengthy arguments rather than, as they used to be, brief summaries of authorities. Either way, when the “peripheral blood stem cell apheresis” method of “bone marrow transplantation” is used, it is not a transfer of a “human organ” or a “subpart thereof” as defined by the statute and regulation, so the statute does not criminalize compensating  the donor.

On it’s face the Court’s analysis seems to be on the money. As noted, if apheresis is “organ donation” for which compensation is barred, then so is regular blood donation. The problem with barring compensation, of course, is that it tends to reduce the available supply of the product in question. Yes, many people will be compelled to donate voluntarily, especially in extraordinary circumstances as the surge in blood donations after 9/11 showed us. However, it’s also fairly obvious that blood donation works largely because compensation is offered, and it seems equally clear that allowing compensation for bone marrow will increase the available supply of the same, which can only stand to benefit the cancer patients who desperately need it. There are obvious ethical concerns about compensating for organ donation, but the idea that the Federal Government’s hypertechnical reading of the statute was acting to the detriment of sick people is really quite shocking.

Virginia Postrel, who herself donated a kidney to a friend many years ago, addressed the more controversial issue of compensation for organ donation several years ago:

Such proposals, of course, attract vehement opposition from people who fear that financial incentives would squeeze out unpaid donors, entice the poor into bad medical choices, or “cheapen the gift.” Some volunteers would undoubtedly drop out, relieved to let someone else provide their loved one’s new kidney. But real incentives, rather than token rewards, would produce a net increase in the number of transplants. Giving a kidney to a relative or friend could still speed up the process, providing an incentive to do so but relieving such donors of any sense of emotional blackmail.

A well-designed system could address the concerns about donor welfare by including educational programs, waiting periods, and follow-up care for donors, and possibly by allocating the payments over time rather than offering immediate cash. As for “cheapening” donation, Matas notes the importance of attitude. “We need to create a culture of dignity. There are many people who want to do this, and the incentive would push them over the edge,” he says. “The message should be, ‘We can compensate you but never repay you.'”

Outlawing payments to donors is ostensibly a way to keep the system fair, giving rich and poor an equally lousy chance of getting a kidney. But wealthier people can already more easily register at distant centers with short lists. They’re also more likely to have friends and relatives who can afford the nonmedical expenses that living donation often entails, including time off from work, child care, hotel rooms, or cross-country travel. (It is legal for recipients or third parties to pay such expenses, but, unlike medical costs, they are not covered by insurance.)

Patients with enough money and the right networks have yet another option. They can go abroad, to countries where the authorities sanction or ignore payments to living donors.


It is also a completely predictable byproduct of the current system, willed into being by policy makers who ignore the plight of kidney patients and by doctors who see above-board payments—and the protections of contract and malpractice law that would go with them—as pollution. Living donation is a low-risk procedure for the donor that offers life-changing rewards for the recipient. Yet the donor is the only person involved in the process who receives no compensation. “There’s no reason that someone who does this should not get something substantial that will make a difference in their lives,” says David. To people who like to celebrate living donors as heroes, payment seems terribly crass. But the vicarious thrill of someone else’s altruism comes at a terrible cost.

There’s another point as well, and that is that everyone involved in a transplant procedure gets compensated for their role, except for the person who donated the organ, or their estate in the case of posthomous donations. That would be like a music industry where the record companies, producers, sound engineers, and concert promoters got paid, but the artists were forced to work for free. That certainly doesn’t sound fair on some level. It’s not an easy issue, and I haven’t entirely made up my mind myself on this, but I also don’t see why its the province of the state to say what someone can and cannot do with their own body.

You can read the full opinion in Flynn et al v. Holder et al here.

FILED UNDER: Health, Law and the Courts, Science & Technology, US Politics, , , , , , , , ,
Doug Mataconis
About Doug Mataconis
Doug Mataconis held a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020. He passed far too young in July 2021.


  1. Anon says:

    One of the big challenges with bone marrow is finding a match. I wonder if people were offered some payment it would increase the number of people who register.

  2. sam says:


    I also don’t see why its the province of the state to say what someone can and cannot do with their own body

    What’s your opinion on slavery contracts?

  3. matt b says:

    Look no further than the organ harvesting industry in India to begin to understand the issues with payed organ donation:


    On one hand, the biggest issues with this is that the people most likely to sell a “redundant” organ are the people who most likely need that redundancy. Your body may be able to operate on a single kidney — for example — but that is under the best of environmental conditions. The poor, who often need short term infusions of money, rarely live under the best of environmental conditions. Which means that the donor is more likely to experience organ failure in later life, putting further stress on the medical system.

    On the flip side, the best argument for legalizing organ payment is that it might prevent donors from getting cheated out of their organs. While this remains a black market enterprise, the donor has no way to sue for breach of contract when they don’t receive payment in full.

    Personally, I think that the remission of the ban is a bad idea from a societal (if not necessarily a legal) perspective.

  4. @matt b:

    There’s also a distinction that needs to be made between a kidney and bone marrow, which differs drastically both in terms of the invasiveness of the extraction process and that fact that bone marrow is self replenishing whereas kidneys are not.

  5. Liberty60 says:

    @matt b:
    You echo my concerns as well.

    I know full well that a philosophical argument can be made for a paid system of organ donations, but like most abstract arguments, they are based on a fantasy world of rational people acting in the vacuum of free choice.

    Like euthanasia, prostitution, indentured servitude and the like, the line between coercion and consent becomes pretty murky.

  6. Racehorse says:

    How about effects this could eventually have on the organ donor program for deceased persons?

  7. matt b says:

    @Stormy Dragon
    Fair point. I wasn’t necessarily attempting to equate the two. I was more interested in trying to ground the larger debate about what might be wrong about selling redundant/reproducing organs.

    All good points, though I am more open to the ideas of legal prostitution and euthanasia. That said, there are huge issues in implimenting either in a way that protects the individual in question (see the problems Amsterdam has been having with the prior).

    I shudder to think about the implications of compensating for organs from cadavers. There’s a lot of scary stuff going on in rural China around that topic.