The Aug. 16 editorial exploring ways to reduce the budget impact of rising Medicare costs deals only with symptoms. We are victims of a medical system where costs are out of control. Pouring in more money solves nothing.

Consider my experience: On Nov. 7, 1988, I had cataract surgery on my right eye on an out-patient basis at Washington Hospital Center. I was on the premises less than half a day. The hospital bill was $3,496.14. On April 17 I had similar surgery on my left eye at the same hospital. This time the bill was $4,465.90. Supplies and equipment involved were nearly identical, but every item had been marked up substantially between Nov. 7 and April 17.

I am aware that our medical system provides state-of-the-art resources. But I am also aware that the charge for the operating room for one hour at Washington Hospital Center was almost precisely what I paid for a six-day stay, including surgery, at Humana Hospital Wellington in London in April of 1985. This state-of-the-art luxury for-profit hospital, operated by Americans, is the hospital of choice for the world's wealthiest people who require complicated heart surgery.

There are numerous explanations for outrageous hospital bills, and each has elements of validity. But the overall explanation is that we have a medical industry that is devastatingly efficient at periodically increasing its prices and at introducing new and often unneeded procedures and technology at constantly higher prices. And we have insurance systems, both Medicare and private, that are bottomless pools of money to be exploited by the medical industry.

None of my doctors will work for Medicare prices, and I find that in some instances Medicare is essentially an add-on for them: it enables them to charge more than they could otherwise, and it keeps my share of the fee at or below where it would be if Medicare didn't exist. Medicare and supplemental insurance protects the consumer from hospital bills, but I find no evidence that they put a brake on hospital charges. On collateral service, such as independent lab fees and anesthesiologists, Medicare occasionally wins one for the consumer. For example, the anesthesiologist (who is hired by the hospital -- not by me or by my surgeon) wanted $702 for my April 17 operation but was required to settle for what Medicare approved: $211.42.

While there is no simple answer to rising medical costs, feeding the insatiable money appetite permits the disease to spread.

STANLEY E. COHEN Bethesda