EDMONDS – When Mark Moody and Glenda Krull could no longer afford both health insurance and mortgage payments, the Edmonds couple knew which had to go.

They sold their house.

Moody, 60, had a liver transplant four years ago and may need another. He alone pays $1,345 a month for the most generous policy he can buy from Premera Blue Cross.

And he’s desperate to hang on to it – even though the costly premiums drove his wife to downgrade her own coverage, decimated their retirement savings and, just this month, forced them out of their well-appointed home into a newly purchased house half its size.

For Americans with serious illnesses, even good insurance is no guarantee they won’t go broke and they will get all the medical care they need.

In 2007, nearly two-thirds of all personal bankruptcies filed across the country were linked to illnesses, loss of income or high medical bills, according to a survey published in June by researchers at Harvard University and Ohio University. Of those cases, 78 percent of the debtors had health insurance when they first got sick.

What’s more, even insured people without serious health problems like Moody are struggling to afford increasingly higher deductibles and co-pays that are eroding the value of employer-provided insurance.

Perhaps as much as the plight of the 46 million Americans with no coverage at all, it’s this anxiety – the worries of the medically insured – that’s driving Congress to take on the most ambitious health reform efforts since former President Bill Clinton’s first term.

“It’s not just the uninsured. It’s people who have insurance that doesn’t protect them” who are fueling the hunger for reform, said Sara Collins, an economist and a vice president at The Commonwealth Fund, a private health care foundation in New York.

Until about a year ago, Moody and Krull lived comfortably on her earnings as an associate real estate broker. But despite their income and his seemingly gold-plated coverage, he can’t get either a second organ transplant or an expensive drug that might eradicate his hepatitis C without risking financial peril.

Moody readily acknowledges the clashing self-interests – his included – that are attempting to sway the debate over reforms. Yet he also believes that when insurance slips beyond the grasp of people such as him and Krull, it’s a sign that the country’s health care system has gone seriously awry.

Moody’s premiums might be even higher were it not for the fact that in Washington, insurers are barred from using health status to set individual rates.

Premera has 75,000 individual-plan members in Washington, 70,000 of them covered by its for-profit subsidiary, LifeWise.

Krull and Moody are among the other 5,000 who have Premera policies that date from Washington’s 1993 tangle with comprehensive health reform.

The state began requiring insurers selling individual policies to issue them to anyone who applied, and banned restrictions on coverage for pre-existing conditions. But it didn’t require that everyone be insured.

Predictably, sicker people tended to seek coverage, and for only as long as they needed it. Saddled with millions of dollars in losses, Premera and all other major insurers quit selling individual plans in the state.

Roe believes that true reform starts with attacking the root causes of high health-care costs: unhealthy lifestyles, unnecessary or unproven treatments and consumers who are still insulated from having to pay directly for much of the care they receive.

Moody understands that tackling that problem will demand wrenching decisions that the national debate has barely begun to address.

Should sicker and older people like him pay even more for coverage?

Having invested $250,000 in a liver for him, should Premera be compelled to pay for another?

What about taking a longshot chance on Pegasys, which, if it works, would be cheaper than a transplant?

“We don’t necessarily blame anyone,” Moody said. “We’re just asking: What does a person do in a situation like this?