The Justice Department and the National Marrow Donor Program are scrambling to overturn a panel decision to allow compensation for bone marrow donors.

The Obama Administration said in a petition filed last week that the decision conflicts with the National Organ Transplant Act. The law includes bone marrow among the organs and body parts that cannot be sold.

Last month a unanimous three-judge panel in San Francisco ruled in favor of the nonprofit group, which hopes to encourage bone marrow donations by offering $3,000 scholarships, housing allowances or charitable donations to those who are matched with blood disease patients.

The National Marrow Donor Program argued in December, just after the panel’s decision, that “a donor system that relies on the human desire to help others is far superior to one that focuses on self-gain.”

The Justice Department said in its petition that “[t]he panel’s ruling rests on legal errors of exceptional importance, threatens to disrupt current patient care and undermines Congress’s clear policy of encouraging voluntary bone marrow donations.”

New technology has made the extraction of stem cells found in bone marrow as simple as blood donation – a process called apheresis.

Therein lies the loophole – the San Francisco panel said it is up to Congress if it wants to include blood marrow in its list of items that cannot be sold, but the apheresis method extracts only blood and thus there is no prohibition on paying for it.

“It may be that ‘bone marrow transplant’ is an anachronism that will soon fade away as the blood extraction method replaces needle-extraction of bone marrow,” wrote Judge Andrew J. Kleinfeld.