Data were obtained from more than three dozen interviews with persons responsible for the policing of the medicare and medicaid programs at both State and Federal levels, medical licensing personnel, officials of the American Medical Association, and others. Interviews were also conducted with 42 criminally and administratively sanctioned physicians and with a control group of 34 nonsanctioned physicians. In addition, eight sanctioned psychologists in California were interviewed, and a demographic portrait was compiled of physicians who have been suspended and excluded from medicare and medicaid from 1977 through 1982. California and New York, which are the largest participants in the programs had the greatest number of sanctioned physicians. Family practitioners composed the largest percentage of violators, followed by psychiatrists, general surgeons, internists, and obstetricians and gynecologists. Thirty-six percent of the physicians sanctioned were foreign medical school graduates. Among the domestically trained doctors, Meharry College, a school for black students, had the largest number of violators. The concentration of foreign-trained and black doctors among the violators may be related to their location in inner-city practices, where large 'medicaid mills' flourish. Sanctioned physicians generally did not view themselves as cheaters and were more angry than ashamed about what had transpired. No major differences were found in the attitudes of sanctioned and nonsanctioned doctors about the programs. The need for improvement in control strategies and changes in regulations is identified. Eight reference are included - for the full report, see NCJ 95226. (Author abstract modified)