Blood money – should blood donors be paid?

Phillip O'Riordan


August 13th, 2014

Australia is facing a budget blowout – a plasma budget blowout. Phillip O’Riordan examines the merits of remunerating blood donors.

Plasma is one of the main components of blood and essential in many health procedures. Australia spends close to $150m a year on imports of plasma products, triple what it spent a decade ago. It is somewhat ironic then that it is illegal to pay for blood donations in Australia. Australia is not alone in its situation: France, the UK, Japan and New Zealand also import blood plasma whilst banning paid donations. Only one country, the United States, has found a way to be self-sufficient in blood plasma. Not only does the US satisfy its own needs, but also those of nearly every country mentioned above, producing 70% of the world’s supply of blood plasma. How does it achieve this feat? It pays its plasma donors.

Entirely voluntary blood donations have not always been the norm. In the early days many countries carried out both voluntary and paid blood donations. However, as supply increased to meet demand during the 1960’s and 1970’s, social debates began over remunerated blood donations. In 1970, The Gift Relationship was published. Written by British social scientist Richard Titmuss, the book compared the altruistic, non-remunerated British blood donation system with the profit-driven, mostly remunerated US system. Titmuss concluded that the superior performance of the British system illustrated how a system based purely on altruistic donations led to higher donation rates and less exploitation of the poor. Five years after The Gift Relationship was published the World Health Organisation passed resolution WHA63.12, recommending that all countries promote fully voluntary blood donation systems. The US and many other developed countries followed suit soon after, eliminating remuneration for blood donations (although the US still provides remuneration for plasma donations).

Why then does most of the developed world ban paid blood and plasma donations? And, why does the US, despite paying for 81% of its plasma donations, ban paid whole blood donations?

Three common arguments for a voluntary donation system are that: it leads to higher donation rates; volunteers provide safer blood than paid donors; and, it frees up more money for other health services.

Since Titmuss famously concluded purely altruistic systems lead to more donations many policymakers have accepted it as gospel. However, Titmuss may have mistaken correlation for causation. Looking at the countries that switched from paid to voluntary blood programs, from the US in the 1970’s to developing countries today, it appears that moves towards altruistic donation programs occur after significant increases in donation rates[1]. This makes logical sense; as supply increases relative to demand, blood collectors can be more selective of potential donors, opting for the lowest cost route, i.e. volunteers. As today’s plasma market illustrates, it is only when there are not enough volunteers to meet demand that countries begin to pay donors. While volunteer-driven countries like Australia and the UK spend tens of millions importing plasma each year, the US’s system of paid donations has made it by far the largest producer of plasma in the world. Whole blood and plasma are identical in nearly every aspect, particularly in being renewable body parts and posing the same health risks to donors and patients. There is no reason then to think that the US’s model of remunerated plasma donations could not also apply to blood.

Advocates of altruistic blood programs do not just point to the possible increases in quantity but also the quality of blood that comes from altruistic donations. It was only thirty years ago that thousands of blood transfusion patients contracted HIV from contaminated blood products during the AIDS epidemic. Providing financial incentives for blood donations could lead to adverse selection – attracting donors from low socioeconomic backgrounds with high risks of transmissible diseases. However, recent data from the World Health Organisation on 45 different countries shows no link between the percentage of blood donations that are altruistic and the percentage of contaminated blood donations within a country. Furthermore, today’s cheap and reliable testing facilities make the risks of contaminated blood negligible.

Perhaps the most compelling argument for non-remuneration of blood donations is the financial one. In the US and Europe, hospitals and drug companies pay an average US$150-200 for a unit (around 450ml) of blood to organisations like the Red Cross that collect it for free. However, the costs of collecting blood, even in a non-remuneration system, are immense.  Last year the Red Cross’s Australian blood service generated AUD557m in income, but incurred AUD548m in costs. If the Red Cross, currently Australia’s sole blood collector, had to pay donors on top of its current costs, it might have to downsize its blood service or divert funds from other operations. Even if it could prove profitable, one could argue that the movement of cash from blood collectors to donors could be detrimental to society in the long run, especially if those who would otherwise give altruistically ask to be paid as well.

However, this assumes that remunerating donations would add incremental costs to the current system. As previously mentioned, the Australian Government (through the National Blood Authority) pays AUD150m a year importing blood plasma products – money that could otherwise be paid to Australian donors. Furthermore, during shortages blood collectors incur higher costs through paid advertising and blood drives, money that could otherwise go directly to donors. Lastly, a remuneration system would increase competition for blood and plasma products, which could significantly cut costs for hospitals, healthcare providers and also the largely taxpayer-funded healthcare system. Unfortunately, the lack of historical references and financial data make these questions nearly impossible to answer.

While the above three arguments are critical to the blood donation debate, there is one other seldom-mentioned point underlying the discussion. For countries like Australia that must import blood products, the blood donation debate is not so much a question of whether to pay donors but one of which donors to pay. Under the current non-remuneration policy, Australia spends AUD150m a year indirectly paying US donors for blood products.

For Australia and much of the developed world, the question of blood donations is complicated. Either way, Australia and the developed world enjoy the luxury of a steady supply of blood products regardless of voluntary donation rates. Yet they are a minority. Despite the WHO’s recommendations, most countries must rely at least partially on paid blood donations to fulfil their blood demands. While the Gift Relationship and WHO may believe otherwise, this author believes that non-remunerated blood donations may be no more a medicine than a luxury.


The views expressed within this article are those of the author and do not represent the views of the ESSA Committee or the Society's sponsors. Use of any content from this article should clearly attribute the work to the author and not to ESSA or its sponsors.

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