One fourth of Medicare recipients spend 20 percent of income on medical costs On average, recipients spend $3,024 on medical bills every year.

 -- For many older Americans, Medicare can be a lifeline. But a new study finds that more than one fourth of Medicare recipients still spend a significant portion of their income on health care.

The study by The Commonwealth Fund found that 27 percent of Medicaid recipients pay 20 percent or more of their income on medical costs, including monthly premiums. On average, recipients spend $3,024 on medical costs every year.

“Medicare is a critical lifeline for older Americans, whose health needs tend to increase as they age,” said Commonwealth Fund President Dr. David Blumenthal. “With one-fifth of the U.S. population projected to be enrolled in Medicare by 2024, it is vital for Medicare to keep evolving to make health care for seniors more accessible and affordable.”

The researchers examined the 2012 Medicare Current Beneficiary Survey (MCBS) that projected population and spending through 2016 based on the national health expenditure accounts. The 11,299 respondents are weighted to be representative of the entire population of Medicare recipients.

Medicare does not cover vision, dental or long-term care for seniors. Not does it cover prescription drug costs, unless people buy Medicare Part D. While people can purchase additional insurance, or "Medigap" supplemental insurance at an average cost of $2,000 per person, the extra coverage can be out of reach for many, especially because 45 percent of Medicare recipients earn less than $24,000 annually.

"Unless you buy supplemental insurance you are extremely exposed," lead author Cathy Schoen, a senior scholar in Residence at the New York Academy of Medicine, told ABC News.

Without supplemental insurance, Medicare beneficiaries would have to pay $1,300 each time they are hospitalized.

"The burdens are particularly high for people which are low and middle income," said Schoen. "They get squeezed."

She said some Medicare recipients end up spending so much on health care they eventually qualify for Medicaid insurance as well.

The 5.4 million Medicare recipients who do not have supplemental coverage paid an average of $5,374 on out-of-pocket expenses in 2016, according to the report. Those with supplemental coverage paid about half that, or $2,587.

Schoen and her co-authors urge lawmakers to be cautious when making changes to the Medicare program. While some costs have come down, they anticipate overall costs to rise as more people join the program.

"Access and affordability remain key concerns. In any discussions of potential Medicare reform, it will be important to pay particular attention to consequences for those vulnerable because of poor health or low income," the authors wrote.