While public cord blood banking is free, parents have to pay for private banking. Get the lowdown on cost breakdown, insurance coverage, and more. 

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Cord blood is found in the umbilical cord and placenta. It's rich in stem cells that can morph into all sorts of blood cells, making it ideal for treating diseases that harm the blood and immune system, such as leukemia and certain cancers, sickle-cell anemia, and some metabolic disorders. 

Thanks to the potential life-saving abilities of cord blood, some parents choose to store it in a bank. Here's how it works: After the umbilical cord is cut, the obstetrician will harvest the stem cells in a non-surgical procedure. The cells can then be stored indefinitely in a secure holding environment and withdrawn when needed.

Cord blood stem cells can be donated for public use or registered privately within a family. Here's the difference between public and private cord blood banking:

Private Cord Banking: Families can pay to store cord blood at a private bank. The blood is reserved for your own family; nobody else can access or use it, and it will never be allotted to another family or be donated to research. Private cord blood banking can benefit those with a strong family history of certain diseases that harm the blood and immune system. Parents who already have a child (in a household with biological siblings) who is sick with one of these diseases have the greatest chance of finding a match with their baby's cord blood—although there's still no guarantee. 

Public Cord Banking These are nonprofit companies that store your donated cord blood for free. It becomes available for any transplant patient—and also for research purposes—so accessing your own cord blood in the future isn't guaranteed. The American Academy of Pediatrics (AAP) recommends public cord blood banking, because the diseases that might require cord blood transplantation are very rare. Indeed, some estimates say that between 1 in 400 to 1 in 200,000 children will need their own stored cells in the future. "The chances that an infant's cord blood cells will be used for transplantation are 30 times greater in the public cord blood banking system as compared with private cord blood banking," says the organization

mother holding newborn baby
Credit: JOSE LUIS PELAEZ INC/GETTY IMAGES

The Cost of Private Cord Blood Banking

Public cord blood banking is free, but you need to pay for private banking. According to the AAP, you can expect to pay between $1350 and $2350 for collecting, testing, and registering. You'll also pay $100 to $175 in annual storage and maintenance fees. Both public and private cord blood banks require moms to be tested for various infections (like hepatitis and HIV)—and depending on factors like your insurance plan, this could add to the cost.

Why is the price of private cord blood banking so high? "This is a medical service that has to be done when your baby's cells arrive, and you certainly want them to be handled by good equipment and good technicians," says Frances Verter, Ph.D., founder and director of Parent's Guide to Cord Blood Foundation, a nonprofit dedicated to educating parents about cord blood donation and cord blood therapists. "It's just not going to be cheap." 

Does Health Insurance Cover Cord Blood Banking? 

No, health insurance companies will not typically reimburse families for any of the costs of private cord blood banking. That said, certain insurance companies may pitch in if a sibling needs to be treated with cord blood in the near future, Dr. Verter says.

Is Financial Aid Available? 

Financial aid is available for some families that opt for private cord blood banking. If you have a sick child who could benefit from umbilical cord blood, banks may offer programs in which they'll cover free cord blood processing and storage. In other words, this financial aid is usually only available if your baby has a biological sibling with certain diseases.