But banking cord blood can be expensive for parents, Dr. Jon Lapook reports.
James was six weeks old when he was diagnosed with leukemia and given a 50-50 shot at survival.
"It's every parent's worst nightmare," said James' mother, Maura. "We were in shock. We were devastated."
His best hope was a stem-cell transplant.
Fortunately, two years earlier, on a whim, his parents had saved his sister's umbilical cord blood.
"Aileen was a perfect match," Maura said. "They said, 'you hit the lottery.'"
Parents looking for a medical safety net have turned private cord blood banking into a multi-million dollar industry.
There are 26 private banks in the United States. After an initial fee averaging $1,500, most banks charge $100 per year for storage. That adds up to $3,500 by the time a child is 21 years old – a high price tag for something you might not ever need.
There is another option that doesn't cost a penny: donating to a public bank.
The donated cells are then available to any patient. But there's no guarantee of donors getting their own cells back. Another problem: fewer than 10 percent of hospitals offer cord blood collection, so precious stem cells are going to waste.
If you don't donate those cells, what happens to them?
"They will go in the trash," said Pablo Rubinstein, director of the New York City cord blood program.
Right now cord blood is mostly used to treat blood diseases. But there's hope that someday, it will be used to treat heart disease and diabetes.
For now, the odds of needing stem cells are one in 20,000.
The parents of James are glad they took those odds.
Their best moment, according to Maura, was "probably when we came back from the hospital. And we were all together again."
Thanks to his sister Aileen, today 4-year-old James is considered cured.