THE FEDERAL GOVERNMENT is obliged to see that the Medicare program provides good care to senior citizens and that costs are kept within reason. This means that someone must monitor the work done by individual doctors and by hospitals with an eye to the quality of care and the potential abuses involved in the delivery system. It would be extremely difficult to oversee millions of cases from Washington; the bureaucracy cannot be expected to have enough experts to evaluate each medical decision. The government, therefore, has turned to the medical profession itself for assistance.

Originally, Professional Standards Review Organizations composed of private practitioners were set up in every state and given a mandate to see that both Medicare patients and the taxpayers were well served by the program. Between 1973 and 1984 these organizations disciplined 70 doctors and hospitals, temporarily barring them from treating Medicare patients because of inferior treatment or billing for unnecessary procedures. Nevertheless, it is widely believed that the panels were not as effective as they could have been, and at the direction of Congress they were completely reorganized last year.

In an article published on Sunday, The New York Times reported that disciplinary proceedings by the new Professional Review Organizations have increased dramatically. The new boards have a more clearly defined mandate and specific goals, state by state, for reducing costs and improving patient care. In 71/2 months these agencies have begun proceedings against 950 doctors and 183 hospitals. Most of the cases involving physicians were brought because of poor care. Those against hospitals were based primarily on billings for costly and unnecessary treatment.

One federal official quoted in the Times story said there is "much more acceptance now among physicians" of their responsibility to discipline peers. In part, this is undoubtedly due to the realization that there is absolutely no Medicare money to waste and that unnecessary procedures must be eliminated if federal funds are to be stretched as far as possible. Surely, too, physicians are fed up with high medical malpractice insurance bills and are ready to weed out the bad apples whose incompetence drives up these costs.

It is in the interest of doctors to correct abuses and discipline hospitals and members of the profession rather than leaving the chore to the government, the insurance industry or the tort system. Wisely, the reorganized review boards are taking this responsibility seriously and stepping up the pace of review.