The medicare-medicaid laws, passed in 1965 to provide government-paid medical services for the poor and elderly, were given antifraud and abuse amendments in 1977 to combat burgeoning provider fraud. These amendments tightened existing loopholes and stiffened penalties for fraud (which carries civil). Generally, fraud consists of intentionally billing the Government for services not rendered, while abuse refers to unneeded care or referrals ordered at the Government's expense. The amendments require proof of willingness or knowlede as prerequisites for conviction. This intent standard applies to making false statements about obligations to pay or amounts due, concealing reasons for a recipient's ineligibility, diverting payments for unauthorized uses, falsely claiming to be a provider, and charging more than allowed for services. Many amendment provisions are designed to facilitate investigation of offenses and require institutional providers to conform to a uniform cost reporting system. Finally, the amendments provide for Federally-financed peer review. Footnotes are included.