Why Blood Banks Charge For Blood When It Is Donated?

Yesterday I was having a cup of tea with a group of people who had come to discuss some projects their organsiation wants to do in the domain of blood donation. During the conversation one of them mentioned about “blood banks make money out of blood donation”- statement I have heard several hundred times in 15 years.

This triggered me in to writing this piece.

Donated blood cannot be transfused to any patient as is where condition. Ask yourself whether you would like to receive. It can happen only in the domain of “woods” –  Kolly, Bolly, Tolly….

Let’s look into the activities that happen to make available safe blood and blood components to patients:

  1. Social marketing to create awareness on voluntary blood donation and get the potential donor to donate blood. One out of 30 calls succeed.
  2. Collection of donated blood into a sterile single use disposable bag (cost varies for single, double, triple bags and the quality of the bags).
  3. Post Donation care – refreshments, donor certificate, donor card.
  4. Donor blood grouping.
  5. Separation of Blood into components.
  6. Storage of the blood and blood components at appropriate temperatures – till given to patient or discarded for various reasons.
  7. Testing the donated blood to ensure safety – this might vary from blood bank to blood bank based on the number of tests and the quality of testing.
  8. Compatible testing to identify the correct unit for transfusion for a given patient.
  9. Packing and release of the identified unit to the hospital.
  10. Expense relating to discard of blood units which have already been tested and found unfit for use.
  11. Cost involved in safe disposal of waste generated (bio-medical waste disposable).
  12. Employee cost (salary).
  13. Cost of purchase and maintenance of expensive equipments.
  14. Rent, electricity, and cost of diesel to run the generator.

It costs on an average Rs. 1500 to process single blood donation.

In the absence of any government support, blood banks have to recover these expenses either from the patients who can afford to reimburse them or by way of donations from the society it supports. Government blood banks also spend money to process blood and the same comes from the taxpayer’s money!

Jeevan is fortunate to have supporters in the community. Jeevan meets the blood needs of several hundred patients every year through the “Make Blood Free” programme with public support. Beneficiaries are children with Thalassemia (need 2 blood transfusions a month), Patients of Tanker Foundation (Dialysis), Adyar Cancer Institute, Govt. Children’s Hospital and many others. Major donors to this programme are Rotary Club of Madras Metro and Cognizant Foundation.

There is no free lunch in this world!

You can also support Make Blood Free. Join the mission at www.jeevan.org

Till next time…


Is Charity Dying in India?

Three incidents in quick succession make me feel that charity is dying in India.

In February 2009, Jeevan Blood Bank and Research Centre, a Chennai based not-for-profit established the first Public Cord Blood Bank to help children with blood cancers and Thalassemia. The vision is to make available matching stem cells from donated umbilical cord blood to these children either free or at affordable cost.

For this project which will benefit children across India and children of Indian origin across the world, Jeevan needs 90 crores of rupees over three years to collect, process, test and store 30,000 cord blood donations. The only silver lining in fund mobilisation is the approval of 35 AC status to donations up to 47 crores of rupees – meaning 100% tax exemption to donations. Donations in US and UK through www.giveindia.org are eligible for tax exemptions.

In this background let us look at the events:

1. Letters to over 500 Chairmen and CEOs of Indian companies has not elicited any response – except two companies contributing to 30,000 rupees each! I suspect (al)most all of them did not even reach the their table. All that was needed was 30,000 donations of 30,000 rupees each across India – I am sure organsiations like CII can facilitate this as “CSR” activity of the member companies!

2. During a recent dinner meeting one of my good friends said his company has a significanT tax liabIlity this year because of extremely good business – money came from sale of consumables to blood bank industry across India. I was told that his CA had advised him either to pay the tax and retain the money or share it with employees and write off as business expense instead of “donating”. His reason – these “loyal” employees will bring in more money to the company next year!

3. Recent suggestions of the Ministry of Finance, Government of India to change the policies relating to tax exemptions to donations, if approved, will place the final nail on the coffin of charity.

We at Jeevan are debating about the options available to ensure availability of matching stem cells to these children while the country is watching IPL3.

We are born optimists – like every team and owners of IPL!!!!

Till next time….