In Baltimore, a 20-year-old waitress alleged that her doctor botched a routine gynecological procedure so badly that she was forced to undergo a complete hysterectomy.

In Hagerstown, a 61-year-old welder charged that doctors burned away a large section of his abdomen by applying too much radiation to his cancerous prostate.

A young couple in Prince George's County asserted that doctors overestimated the pelvic opening of the mother during the birth of their baby, which they said resulted in permanent brain damage for the child.

The waitress, the welder and the young parents all hired lawyers and set about attempting to prove their suffering was the fault of doctors. But rather than getting a chance to file damage suits, they became victims of what many are calling "Maryland's malpractice mess."

Four years ago Maryland's legislature, responding to what doctors called a malpractice crisis, enacted a law requiring all suits against doctors to go to arbitration before being taken to court. A new agency, the Health Claims Arbitration Office, was established to receive all claims and to appoint three-member panels consisting of a lawyer, a doctor and a layman to hear them.

Since this process began more than 400 people have filed malpractice claims with the state.

Only 14 cases -- or 3 1/2 percent -- have been decided by the arbitration panels.

The resulting backlog of cases is so large that hundreds of Maryland patients -- each alleging some kind of medical horror story -- have been denied access to hearings to which they are entitled by law. And the situation worsens every day. An agency that was set up to process 50 cases a year -- and hasn't approached even that level of efficiency -- instead has been getting 30 cases a month this year, more than seven times what it was supposed to handle.

"The whole system," said malpractice attorney Marvin Ellin, "is sinking into the sea."

Patients such as the welder, the waitress and the young couple are not the only victims of the malpractice system in Maryland. Hundreds of doctors -- like the patients -- have had to wait for months and years for the disposition of the cases.

"It tears the physicians up, it tears them to pieces," said John King, who represents doctors in malpractice cases.

It is the doctors, however, who can take most of the credit, or blame, for establishing the arbitration process in the first place.

In the mid-1970s Maryland's doctors, much like their colleagues across the country, believed that malpractice suits were threatening their livelihood.

Suits were being filed -- and won -- by patients in unprecedented numbers, and the companies that provide doctors with malpractice insurance were raising prices accordingly.

Maryland doctors became rebellious. Surgeons and anesthesiologists at Silver Spring's Holy Cross Hospital announced they would perform only emergency surgery unless the state took steps to afford them better protection from patient lawsuits. Similar threats surfaced at Peninsula General Hospital in Salisbury, at a hospital in Columbia, and in Harford County, where doctors voted to withhold services in all but the direst cases.

The powerful state medical society was forced into action. Legislators were lobbied by their personal physicians. "Something has to be done quickly," stated John Sargent, executive director of the 5,000-member society. "Otherwise . . . many doctors aren't going to practice."

The legislature acted with dispatch. In 1975, it created a new doctor-run malpractice insurance company. The next year it passed the malpractice arbitration bill. Now, doctors felt, with their colleagues and lawyers judging claims instead of trial court juries, it seemed less likely they would be hit with huge damage awards, and frivolous cases would never get to court.

The health claims arbitration office got off to a stumbling start in 1976, when its constitutionality was challenged in court. Matters went downhill from there. The agency staff soon discovered it was one thing to require jury duty for the average citizen, and quite another to get doctors and lawyers to participate on the panels.

Many doctors and lawyers are reluctant to serve because of the relatively paltry pay the state was offering for their services -- between $40 and $60 per day. In addition, doctors avoid selection because they belong to the state's doctor-run insurance company and, if they decided for a plaintiff, "it would be giving away their own money," as one medical official put it.

The dearth of attorneys and doctors volunteering for the panels had made it difficult for the state to convene hearings. The process the agency used to recruit panelists doesn't help much, either.

From their quarters in the state office building in Baltimore, a handful of claims office workers examine a computer printout list of all potential panelists from the county in which the case was generated. They give the names to telephone interviewers, who begin the laborious process of finding acceptable and willing arbitrators.

Doctors are eliminated if they have referred a patient to the physician being sued. Lawyers are scratched if they are social acquaintances of the attorneys in the suit. In a county such as Prince George's, said one interviewer, "all the attorneys know each other. . . . That doesn't leave a whole lot of lawyers."

Hundreds of telephone interviews often are necessary to find enough doctors and lawyers who have no conflicts of interest. In scores of cases, the agency simply has been unable to round up a suitable panel after months of searching.

And the claims keep piling up. One hundred in 1978. Then 225 in 1979. Thirty a month this year.

There is a fierce debate among medical and legal officials as to whether the arbitration process, even when running smoothly, is fair. The doctors and lawyers were placed on the panels in the belief they would best understand the complex issues of medical negligence.

But many patients, and their attorneys, argue the doctors would be less likely than laymen to sympathize with a patient's "pain and suffering" arguments. Said one attorney: "If you injure someone with a scalpel or an automobile, what's the difference?Why should you not go into court?"

In fact one of the ironies of the malpractice process in Maryland is that the judgments by the panel in a majority of the 14 cases that have gone through arbitration are now being appealed in court anyway. This means a system designed to streamline malpractice litigation has in fact added one more layer to it.

There are now 25 states with some form of malpractice arbitration system. Allen Tishman, associate counsel of the American Insurance Association, said of Maryland's process: "I haven't heard of it being quite that bad anywhere else."

In fact, Tishman said, the insurance industry, which once fully supported arbitration systems, is now having second thoughts about it.

There are no such second thoughts among the directors of Maryland's medical society and its doctor-run insurance agency. John King, the state medical society's counsel, said he is sure that after every arbitration hearing the patient comes away with the feeling -- "This is fairness, this is openness. This is dealing with it in an impartial way. It works."

At an arbitration hearing in Silver Spring last month, however, there was little sense among the participants that they were taking part in a rational process. As the doctor sat at one end of the long hearing table and the patient peered across at him from the other end, the physician-panelist turned to the chairman and muttered: "It's grossly unfair for them to expect me to give up three days for this."