Often those who disobeyed the code of conduct for the Shinsengumi were forced to either comit honorable suicide or drink the water of life and become a Rasetsu. Later on, the main Shinsengumi members take ochimizu to survive dangerous injuries they had sustained from fights with Kazama Chikage and his cronies. As of season one, the only members of the Shinsengumi that didn't take ochimizu yet are Saito Hajime, Shinpachi Nagakura, Sanosuke Harada, and Kondo Isami (but he got arrested).
People that take ochimizu are referred to as "rasetsu". Ever since he took ochimizu, Sannan-san is the current leader of the Shinsengumi's rasetsu unit. The Shinsengumi and the Bakufu are the only people that know about the unit. It can be considered as a secret weapon.
Rasetsu are not immortal; they can still be injured and killed. Silver weapons, such as bullets, can prevent the rasetsu from regenerating. Furthermore, the rasetsu lose their ability to think logically in battle when they become bloodthirsty, causing them to recklessly fight in battle. Recently, Sannan-san has developed a powder that temporarily stops a rasetsu's need for blood, although when he gives it to Heisuke he tells him that eventually he will have to consume blood to survive as a rasetsu.
In the second season Amagiri, one of Kazama's henchmen, reveals that the Rasetsu are shortening their own lives by using their powers, which slowly consumes their life force. Due to this, Hijikata puts the Shinsengumi Rasetsu Unit out of commission, much to Sannan's irritation.
In the games though, a cure to the life consuming side effect is to drink the waters of Chizuru's home town, Edo.