Organized medicine has never been a fan of the little-known but powerful federal watchdog known as the Office of Inspector General in the Department of Health and Human Services.

Not the job itself, not the law that established it, not the nursing home and Medicaid scandals of the 1970s that gave rise to it, not the investigations and prosecutions that come out of it. And surely not the man who has held the job for the past nine years, former FBI agent and organized crime investigator Richard P. Kusserow.

Now they want him fired.

That won't be easy. Not only does Kusserow have considerable support on Capitol Hill for his efforts to crack down on health care fraud, waste and abuse, but he and his office are by law shielded from the usual budgetary and political pressures. Though nominally an employee of HHS, Kusserow can be fired only by the President.

In a letter to the White House in September, the American Medical Association took the unprecedented step of asking President Bush to fire Kusserow, saying he "is widely perceived to have ignored, indeed fought against, principles of fairness which are routine in the American administrative and judicial system. Competent and honest physicians have been damaged, and many more have been unnecessarily harassed."

Besides the AMA, the American Hospital Association and 38 state medical societies have called for Kusserow's resignation since a controversial interview on ABC-TV's "PrimeTime Live" Sept. 20.

Physicians' groups were particularly incensed by Kusserow's on-camera statement -- which he retracted before it was broadcast -- that a New York doctor excluded from the Medicare program in 1987 was impaired by a drug problem. The doctor, William Diefenbach, was expelled after a panel of physicians concluded that he had seriously mishandled heart patients. He committed suicide last summer.

After the interview was taped but before it was shown on television, Kusserow issued a written retraction to ABC, saying the issue of drug use "played no role whatsoever" in the Diefenbach case. The network nonetheless aired the original statement, mentioning Kusserow's retraction afterward.

The "PrimeTime" show was the "trigger" for the "extraordinary step -- we've never asked for a government official's resignation," said AMA general counsel and senior vice president Kirk B. Johnson. But he said the AMA eventually would have called for Kusserow's ouster anyway because of "a pattern" of harassment against doctors.

Johnson said physicians are "near rebellion" because of what organized medicine has dubbed "the hassle factor" -- increasing regulation of their practices, particularly in the care and billing of patients covered by Medicare and Medicaid, government health plans for elderly and poor Americans.

"Just figuring out what you have to charge a Medicare patient is something you have to hire an accountant to do -- and even accountants will disagree about it," Johnson said. "It's the most regulated sector of our economy today, and Kusserow has become a symbol of that."

As such, he has become the man organized medicine loves to hate.

Kusserow declined to be interviewed about the controversy. An HHS spokesman said HHS Secretary Louis Sullivan had spoken to Kusserow and expressed his support, praising him for his "good, long record" of service as Inspector General.

Kusserow has other supporters as well.

"He's a dedicated public servant," said Sidney Wolfe, a physician and director of the Public Citizen Health Research Group, a consumer organization founded by Ralph Nader. "I'm very impressed with the caliber of people on his staff."

Wolfe said he has "rarely met anyone in government" whose staff is as enthusiastic about their boss as Kusserow's is. "Doctors don't like the idea that a bright, hard-working lawyer armed with laws on the books is calling a tiny fraction of them to task," he said.

Kusserow is being targeted by the AMA, Wolfe said, because "historically, medicine likes to believe that it can police itself without government. Unfortunately, it's wrong."

Kusserow, a Marine who worked 13 years for the FBI, was appointed HHS Inspector General in 1981 by President Reagan. Both supporters and critics often refer to him as the nation's top medical cop.

"It's basically a policeman's perspective," AMA's Johnson said. "Get the documents, get the papers, get the doctors, get the sanctions. He's not supposed to be a cop. He's supposed to be thoughtful, careful and judicious, both an enforcer and a judge."

Johnson said the ABC interview showed Kusserow to be "reckless" and "not honest."

But Kusserow's aggressive approach to waste, fraud and abuse in health care also has strong backing from key legislators on Capitol Hill. "Criticism from the AMA is a 'red badge of courage' to Mr. Kusserow," said Rep. Fortney H. (Pete) Stark (D-Calif.), chairman of the House Ways and Means Committee's subcommittee on health, which has jurisdiction over Medicare and Medicaid programs.

"Anyone who resists giving the AMA completely free access to the Treasury and the taxpayer's wallet is immediately branded by the AMA as anti-doctor," Stark said in a statement. "They throw temper tantrums anytime anyone dares question the divine wisdom of someone with the title of doctor." Stark acknowledged that "mistakes have been made on individual cases." But, he said, "month in, month out, Richard Kusserow has been trying to root out corruption in Medicare and Medicaid."

A total of 192 physicians were kicked out of the Medicare and Medicaid programs in fiscal 1990 for reasons including loss of license, crimes such as falsifying medical claims and provision of substandard care.

The AMA has criticized Kusserow for using a "bounty" system to reward Medicare investigators for meeting quotas in prosecution of doctors for fraud. Kusserow has denied the existence of a bounty system, but a federal court last summer overturned a salary plan in which the number of fines and other sanctions imposed on health care providers was a factor in merit pay reviews of some of Kusserow's staff.

AMA's Johnson said Kusserow has "constructed a system that makes it inevitable that Medicaid fraud units are going to push cases that shouldn't be pushed."

Most federal cabinet departments and many independent agencies now have Inspector General's Offices, modeled on the original one set up in HHS (then the Department of Health, Education and Welfare) in 1976, after heavily publicized nursing home and "Medicaid mill" scandals. "There were abuses, no question about it," AMA's Johnson said. "We've never challenged that, and we don't challenge it today. But the fact is, there isn't that much fraud out there."

Kusserow's is the largest federal Inspector General's Office, with a staff of about 1,400 and its own budget of nearly $50 million.

The responsibility, too, is huge. Kusserow's office audits programs, reviews regulations, analyzes policy and investigates criminal and civil wrongdoing involving the HHS budget of $464 billion. It also supports the 38 state Medicaid "fraud squads" and monitors the nationwide network of Peer Review Organizations (PROs), the private medical groups that the government pays to evaluate hospitalization of Medicare patients and the quality of care given.

Health Research Group director Wolfe praised Kusserow for pioneering cost-cutting efforts such as surgical second-opinion programs in addition to aggressively investigating Medicaid and Medicare fraud.

In the past three years alone, Kusserow's office has issued reports on generic drug prices, racial discrimination in kidney transplantation, weak enforcement of state medical review boards, overtesting by doctor-owned laboratories, mis-medication in the elderly, patient "dumping" by hospitals, unregulated cholesterol screenings, wasteful overhospitalization of Medicare patients and uneven quality of heart bypass surgery.

The HHS Office of Inspector General estimates that in the year ended Sept. 30, it obtained nearly $5.8 billion in fines and settlements and savings from reforms it recommended. It obtained convictions against 1,310 defendants, mostly in the Social Security program. An additional 900 health care providers were fined or excluded from Medicare or Medicaid for fraud or abuse.

History: Created by Congress in 1976 to uncover and deter waste, fraud and abuse in federal health care programs. Became the model for more than 50 other Inspector General Offices in federal cabinet departments and agencies

Purpose: Watchdog over HHS, the largest cabinet department, which administers nearly 250 programs serving 56 million beneficiaries, with a total budget of $464 billion

Current officeholder: Richard P. Kusserow, appointed by President Reagan in 1981

Budget: Nearly $50 million in 1990

Employees: 1,400 STRUCTURE

Audit Services. Checks the books of HHS programs, contractors and grant recipients.

Evaluation and Inspections. Studies HHS programs and policies to identify problems and waste, and recommends reforms.

Investigations. Looks into allegations of fraud and abuse involving HHS programs. 1990 TOTALS:

4,000 audits and inspections

2,800 investigations

1,310 convictions

900 health care workers fined or penalized for fraud or abuse of Medicare

and Medicaid

$5.8 billion in fines imposed, settlements collected and savings gained from reforms stemming from the Office's reports