Many consider it science on the cutting edge: Umbilical cord blood rich in stem cells obtained once a child is born can be used to treat rare conditions and holds promise for the future. And with 4 million births in the United States each year, private cord-blood banking is a growing industry.
But an exclusive ABC News investigation found the costs of private banking outweigh the potential benefits to many families.
In their marketing material, many private banking firms tout an impressive list of 70 to 80 diseases that purportedly are treated by stem cell transplants. But research has yet to prove that stem cells from cord blood work for all of the listed conditions.
"Presently, we treat over 80 life threatening diseases," said Dr. Albert Sassoon, an obstetrician-gynecologist in New York City who spoke earlier this year at a dinner sponsored by ViaCord, a private cord-blood banking firm. "With the amount of diseases that we treat today, by the time you reach the age of 70, you'll have approximately the chance of receiving a stem cell transplant -- one in 200, one in 217."
But many experts told ABC News that the chance that anyone will benefit by their own cord blood -- which is what is stored in private cord banking -- is much lower than that.
Private storage of a newborn's umbilical cord blood can range from $2,000 to $3,000 up front, plus yearly storage fees of $85 to $125. Doctors who refer parents to private cord-blood banking are often compensated by the private company.
Public cord-blood banking is free and is entered in a public system where the cells are available to anyone who needs it. And some diseases such as leukemia, which is listed in ViaCord's marketing material as treatable by stem cell transplants, cannot be treated using the children's own cord blood because the stem cells may carry the same disease. Instead, many doctors turn to public banks for treatment.
The American Medical Association and the American Academy of Pediatrics recommend public banking over private, favoring private banking only when there is already an affected family member or a disease in the family that would benefit from a transplant.
Still, firms such as ViaCord and Cord Blood Registry are banking on many parents who believe that their child's stem cells may one day treat chronic conditions, even though many experts say it's still too early to tell.