Medicare, launched in the 1960s as prime health insurer for the elderly, is now paying only 30 percent of the average older citizen's doctor bills and 38 percent of all medical bills -- hospital as well as doctor -- incurred by senior citizens.

One reason is that fewer and fewer doctors are accepting as their full fee the maximum amounts that Medicare will pay, the Public Citizen Health Research Group said in a report yesterday. Instead, doctors are requiring patients 65 and older to pay a larger share of their bills, said Dr. Sidney Wolfe, close associate of Ralph Nader and Nader's recent successor as Public Citizen director.

Wolf and Daniel Sigelman, author of a new Health Research Group study of the subject, called these charges excessive and said they result in "overpayments."

By law, however, doctors have always been free to charge Medicare patients more than the federal Medicare program pays. And Medicare patients have always been expected to pay at least a fifth of their bill and more if their doctors charged more than the Medicare maximums. Furthermore, a federal health official noted that Medicare is not the only federal program helping the elderly pay their medical bills. Counting such other programs as Medicaid for the poor, the government is currently paying 54 percent of the total health bill of older people, he said.

An American Medical Association official in Chicago also said yesterday that surveys show the average doctor's income has failed to keep pace with inflation in recent years.

A July report by the AMA's Council on Medical Service said the main problem in serving the elderly is not overbilling by doctors but "Medicare underpayment." As part of the government's efforts to hold down costs, the maximum fees Medicare will pay are set nationally at no more than 75 percent of each areas's prevailing fees, the council explained, and are "always based on figures 2 1/2 years old." If Medicare payments were more up to date and more realistic, said the council, more doctors would accept Medicare fees as full payment.

All these facts aside, said the Health Research Group, the elderly with such coverage are now having to pay -- or at least are being billed for -- an average 70 cents on the dollar for doctors' care.

Part of this is made up of the plan's annual deductible, the first $60 in doctors' charges that each beneficiary must pay. Another part is the 20 percent further "co-insurance" on charges, for which patients are also responsible.

But beyond this, said the health group, American doctors now accept assignment on only about half their fees. Between 1968 and 1979, said the health group, the added charges for which doctors billed their Medicare patients rose more than 23-fold, from $50 million to more than $1.1 billion a year.

In 1979, Medicare beneficiaries were called on to pay more than $7 billion of a total $10 billion in Medicare doctors' charges. The average added fee per beneficiary rose between 1968 and 1979 from $2.67 to $43.29 a year. But in many cases, Wolfe said, it is "hundreds of dollars," and "many of the elderly just are not going to the doctor, because they can't afford to."

In 1979, Wolfe said, the average office-based doctor earned $76,260, according to one survey. If that were cut by 10 percent by accepting Medicare fees, said Wolfe, it would still have been $68,640, on the average.

In the Minneapolis-St. Paul area, he added, many "socially conscious" doctors have agreed to accept Medicare fees. As the result of neogtiation by that area's Metropolitan Senior Federation, nearly 1,500 doctors have agreed to accept Medicare fees for about a third of their Medicare patients: individuals with incomes generally below $6,000 to $6,500 and couples with incomes below $7,500 to $8,000, though some doctors include some patients with higher incomes.