In 2001 the Spechts were living comfortably in Albuquerque, New Mexico, having worked at solid jobs there for years--Judy at a Philips semiconductor factory and Phil as a maintenance man at a retirement community. Together, the Spechts were bringing in around $40,000, which in New Mexico was enough to make the $787 monthly mortgage payment on their new home and still have a little left. Lately, Phil hadn't been feeling great--his body ached more than usual--but the Spechts both had health coverage through their jobs. In their late 50s, they were near enough retirement to taste it.

By 2002, though, Phil had grown worse, and after a series of tests, doctors diagnosed myelodysplastic syndrome, a bone-marrow disease that can cause leukemia. Phil retired and began collecting $1,080 a month in Social Security disability payments.

"I still had a good paying job with insurance that could cover us both, so I thought we'd be OK," Judy says.

But when Philips started shuttering some of its New Mexico factories three months later, Judy was laid off. She quickly found a job working at another semiconductor company, but after five months she was axed again. Now desperate, Judy took a housecleaning job at near-minimum wage. It was all she could find.

Fortunately, the Spechts only paid $50 a month for Phil's visits to University of New Mexico Hospital oncologists, thanks to UNM's charity care. But they had trouble affording the regular blood work Phil needed and the monthly $507 in prescription drug payments for both of them, climbing quickly because Judy developed high blood pressure, high cholesterol, acid reflux and an underactive thyroid--"stuff I hadn't experienced before this."

To save money, Judy chopped her blood pressure and thyroid tablets in half, took the acid-reflux medication less often than prescribed and quit her cholesterol pills altogether. "I was left with a choice of my medication or a roof over our heads."

To afford Phil's medicine, the Spechts sold their furniture, some jewelry and a camera. But by the end of 2003, $4,000 deep in medical debt and with $90,000 still left on their mortgage, the Spechts knew they couldn't hold on to their house any longer.

They hired a bankruptcy lawyer and filed for Chapter 7, freeing them from debt but eviscerating their credit for seven to ten years. The bank foreclosed on their mortgage, and the Spechts moved twice before settling in a cheap apartment for people over 55. Although they now participate in a new state program that offers drug discounts to elderly New Mexicans, the Spechts still owe $1,000 in medical bills; even after filing for bankruptcy, the couple continued to rack up bills until Judy finally landed a state job that gave her health coverage. The stress of the past three years has changed the Spechts forever. Judy describes the whole process as "frightening and humiliating."

"We'd wanted to retire in that house. We were heartbroken," she says.

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