Medical reporting: Number of providers registered by MedCo continues to fall
The value of the medico-legal market grew by 4% in 2024, double the growth rate of the previous year, researchers have estimated.
A sector traditionally “populated by many small companies” was showing signs of consolidation, they said, with larger groups increasing their share of the market, often by acquisition.
IRN Research estimated that the overall value of the medico-legal market last year was £648m, a 2% increase on the year before. This came after a dramatic drop of over £150m in 2020, as the pandemic took hold, followed by much smaller falls in value in 2021 and 2022.
Market value was estimated to have grown “more strongly in 2024”, with an estimated 4% growth rate generating a market value of £674m.
The upturn in personal injury and medical negligence claims registered in the year 2023/24 “should drive demand across all key categories” of the medico-legal market, such as medical reports, case management, and rehabilitation services.
In UK Medico-legal and Insurance Services Market 2024, IRN said that while the overwhelming majority of companies in the market were small, “a few larger groups are increasing their share of the market, often through acquisitions”.
It continued: “Until recently the provider population had been growing with barriers to entry for some suppliers such as expert witnesses and individual rehabilitation specialists relatively low.
“In the last two years there has been some reversal of this trend with some MROs [medical reporting organisations] and individual specialists exiting the market given a general decline in claims numbers and weaker margins at the lower end of the claims market, i.e. margins for work on lower-value claims.”
The number of providers registered on MedCo had been declining since its launch, going down from 47 in 2021 to 37 last year and 35 this.
The number of individual medical experts registered on MedCo dropped only marginally from last year to 508, but that is 75 fewer than in 2022.
Consolidation among personal injury law firms was reflected in a fall in registered users from 1,328 to 1,206.
The reduction in the number of low-value whiplash claims as a result of the government reforms also meant the number of searches on MedCo that resulted in a report continued its decline, to just over 218,000 in the year to 30 September 2024.
IRN predicted that the larger players would “continue to purchase smaller players”, with the move to more integrated businesses likely to continue, whether it was integration between law firms and medico-legal operators, accident management and medico-legal companies, or medico-legal operators and companies providing treatment and rehabilitation services.
Artificial intelligence (AI) “and its ability to analyse vast amounts of data” would be used in more services “not just for automating routine tasks but in other areas, for example predicting patient outcomes, personalising treatment plans”. The larger providers “are likely to be at the forefront of AI use”.
Having compared staff numbers at 36 medico-legal companies, researchers said the total “had increased noticeably” since 2022, with 21 businesses increasing employment and 15 reducing it.
A “large part” of the total increase was due to one company, FL 360, described as an “investment vehicle for companies across a range of industries” with a range of medico-legal brands. Staff numbers almost doubled at FL 360, mainly due to acquisitions, from 483 in 2022 to 910 in 2023.
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