A Wisconsin family this week received the first payment in a $1.1 million malpractice settlement from the federal government in the case of a 23-year-old man who died of a usually curable form of cancer at the National Cancer Institute, one of the nation's premier treatment facilities, a lawyer disclosed yesterday.

The family of Mark Bitters, an engineering student from Green Bay, Wis., argued in a lawsuit that Bitters died unnecessarily after physicians at NCI failed to meet nationally accepted standards of care in treating him.

Bitters died in 1981, a year after beginning treatment at NCI for testicular cancer, which was detected in its early stages, according to the lawsuit filed in 1984 in U.S. District Court in Baltimore.

Neither NCI spokesmen nor government attorneys involved in the case would comment yesterday on the settlement, in which no one was found at fault.

Under terms of the settlement, reached in late December and made public by an attorney for Bitters' family, his widow and the couple's 5-year-old daughter will receive annuity payments totaling $1.1 million over 30 years.

According to the attorney, John Domingues, Mark Bitters went to NCI in January 1980. He was operated on for removal of a tumor and should have undergone blood tests every month for a year to ensure that all the tumor had been removed and that the cancer did not spread, Domingues said.

That level of patient monitoring was widely accepted throughout the medical community at the time of Bitters' treatment, according to Domingues, and was promulgated by NCI physicians themselves in studies published in medical journals.

But in April 1980, Bitters was told to return to NCI for a checkup in three months, according to court papers.

During that time, Bitters lost more than 20 pounds and began to bleed and have headaches. By the time he returned in August, his cancer had recurred and spread to other organs, including his lungs.

Bitters received chemotherapy treatments at NCI but died the following May.

Bitters' family maintained that monthly blood tests would have detected the recurrence of the cancer before it spread.

The American Cancer Society estimates that 96 percent of testicular cancers can be cured if they are caught before they spread to other organs.

According to court papers filed by the government, Bitters was treated by several physicians, and one of them was supervised by Dr. Nasser Javadpour.

Javadpour, who was not a defendant in the suit, was a senior physician in NCI's urology cancer section.

He left NCI in 1984 and is now director of the urology section at the University of Maryland Hospital in Baltimore.

Yesterday, he acknowledged operating on Bitters, but said he had little other involvement in the case. "I operated on him and saved his life," said Javadpour. Beyond that, he said, "I didn't have a role really . . . . I was not involved."