The present paper deals with a mathematical model for the effect of permeability of porous medium on MHD flow of blood in very narrow capillaries. It is assumed that there is a lubricating layer between red blood cells and tube wall. The analysis of fluid flow between red cell and tube wall, when the cell appears to be at rest and the capillary wall moving backwards, is made. The effect of porous medium is examined. Analytical expressions are shown through graphs to describe the effect of various parameters on velocity profile, leak back flow rate and skin friction. It is found that the velocity profile increases numerically as permeability of porous medium increases and leak-back flow rate decreases numerically as magnetic intensity increases.