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Suzanne Lucas and her husband have paid off the big bills in their life, including their cars and the loan on their home. But even though they're both still working, the 60-year-old St. Paul woman said they can't keep up with their medical expenses.

"We are using our credit card and our home equity line of credit," Lucas said, "and with both of those, so far we are $4000 in the hole."

The Lucas' have medical insurance. Their out-of-pocket medical expenses and premiums totaled $12,000 last year. Suzanne said most of the money went for medications and doctor's visits due to a few chronic conditions. 

She expects their health costs will remain at that level for the next few years. 

"We're just living in debt until we're both 65 and get Medicare," she said. "And that's what we're looking forward to because it will be so much better with Medicare."
  

The Lucas' aren't alone. This fall, a Kaiser Health Tracking poll found that one in three Americans has had problems paying medical bills in the past year. That's up considerably from two years ago when one in four people reported having trouble keeping up with health care costs. And its not the only poll to show this trend.

In October, the Employee Benefit Research Institute based in Washington D.C. released its annual Health Confidence Survey. 

Researcher Paul Fronstin said one-third of his survey's respondents said increased health care costs made it difficult to pay other bills. 

"They're having trouble paying for basic necessities like food and housing," Fronstin  said. "They are using their credit card. They are declaring bankruptcy. They're using up their savings to respond to higher health care costs."
 

The economy is making the situation worse, but there are other reasons people are having more trouble paying their medical bills. In recent years, employers have been passing on a bigger share of health care costs to their employees in the form of increased premiums, co-pays and deductibles. Fronstin said in 2008 the average deductible for employee-only coverage in small firms surpassed $900.  

To compensate for those higher, out-of-pocket costs, nearly a third of people surveyed by Fronstin's organization said they were cutting back on contributions to their retirement plans. More than half said they were putting less money toward savings. 

But Fronstin said he's more troubled by one particular trend. 

"A quarter of the population tells, us because of rising costs, they're either not filling their prescription or they're not taking their medications that they should be," Fronstin said. "And that could have a detrimental effect towards health care because people are going to be sicker."

George Fisher is cutting back on his medications. The 64-year-old Bloomington man has prescriptions for six drugs. But when the co-pays on some of them increased recently, he said he had to make some tough choices. 

"Right now, four is about all I can afford per month and there are two others that I'm not taking," Fisher said.


Forgoing those two drugs isn't life-threatening in Fisher's case, but he said it does cause him some minor discomfort. To cope, he's trying to take better care of himself. Buying healthier food was part of his strategy. 

"But the prices go up so I'm back to eating the bad stuff again," he said, "like the hash browns and the wieners and the things that are cheap to buy." 

There may not be much right now that people can do to get a handle on their high medical expenses. Legislators passed a major reform initiative last year to try to help reign in costs. But the state's projected $4.8 billion budget shortfall in the next biennium could put some of those programs in jeopardy, along with many jobs that are dependent on state funds. 

Shannon Wohlman works for an independent living organization that gets money from the state. She and her husband have nearly $3,000 in medical expenses from surgeries they both had this year. She hopes to keep working to pay off her bills, but she's more anxious about her job since hearing about the state's budget crisis.
 
"I am concerned that it may affect my job in one form or another," Wohlman said. "So that does make us quite a bit nervous about the medical bills and just future medical expenses with co-pays for medications and all of that." 

Wohlman does have a fallback plan if she loses her job. While it's not ideal, she said she can tap some of her student loan money to help pay her medical bills.

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