New Zealand legalizes compensation for organ donors [updated with correction on US law on compensating organ donors for lost wages]

Flag of New Zealand.

The government of New Zealand recently passed a law legalizing compensation for organ donors:

"The Bill effectively removes what is known to be one of the single greatest barriers to live organ donation in NZ," [Kidney New Zealand chief executive Max] Reid says. "Until now the level of financial assistance (based on the sickness benefit) has been insufficient to cover even an average mortgage repayment, and the process required to access that support both cumbersome and demeaning. The two major changes that this legislation introduces—increasing compensation to 100% of lost income, and transferring responsibility for the management of that financial assistance being moved from WINZ to the Ministry of Health—will unquestionably remove two major disincentives that exist within the current regime."

The compensation is limited to offsetting lost income and expenses and does not allow full-fledged organ markets. But it is nonetheless a major step towards increasing incentives for organ donation, which could potentially save many lives. New Zealand-based economist Eric Crampton has a more detailed the discussion of the bill and its history here.

The United States would do well to follow New Zealand's example of fully compensating organ donors for lost wages, and even go further towards full legalization of organ markets. As economist Alex Tabarrok points out, doing so might save thousands of lives every year, and save even more people from having to spend long periods of on kidney dialysis (a debilitating treatment that greatly impairs normal life, and is very costly to boot). Current US policies allow "reasonable" compensation for some expenses, including lost wages. But usually compensation for lost wages is only from recipients themselves and only after the fact rather than in advance).

In the past, I have outlined the case for legalizing organ markets in greater detail, and addressed a variety of objections, such as claims that organ markets would unjustly "exploit" the poor, and arguments that they would lead to dangerous "commodification" of the body and ethical corruption. Most recently, I have commented on a letter defending bone marrow markets signed by a cross-ideological group of leading ethicists.

While people can reasonably disagree about how organ markets should be structured and the extent to which they need to be regulated, there is a very strong case for legalizing them in order to save the lives of thousands of innocent people who are otherwise doomed to an early (and often painful) death, and tens of thousands more who must otherwise undergo years of needless suffering. Ultimately, the question is not whether there are objections to organ markets, but whether any of them are weighty enough to justify the infliction of so much death and misery.

UPDATE: I have made some revisions to this post to clarify the current state of US law.

UPDATE #2: The original version of this post incorrectly indicated that US law forbids most compensation for lost wages incurred by organ donors. It in fact allows "reasonable" compensation for such wages, though public and private insurance policies rarely if ever provide it. I apologize for the error, which has now been corrected.