The government has publicly warned large medical reporting agencies (MROs) to stop registering multiple companies for whiplash diagnosis panels.

Several tier-one MROs – those who say they can handle high numbers of claims – have also registered up to 10 subsidiaries for the second tier of provider, under the new MedCo scheme.

Solicitors are, in theory, able to choose from one top-tier provider and six second-tier providers in selecting a medical expert to diagnose their client. The scheme is designed to take away financial links between lawyers and experts, while at the same time ensuring injured people have a choice of doctor.

But critics have said it is unfair that the largest MROs are effectively restricting that choice by appearing several times in each allocation.

The Ministry of Justice, in a statement published this week on the MedCo website, said it has ‘concerns’ relating to the behaviours of some MROs which have the ‘potential to undermine both the government’s policy objectives and public confidence in MedCo’.

The statement said established high-volume MROs registering multiple new smaller MROs prevents users from choosing from a range of unconnected experts.

It added: ‘The system was neither designed not intended to permit this type of behaviour, but the MoJ is clear that MedCo, through the application of the qualifying criteria, its user agreements and ethics policy, has the requisite tools to address it.’

The MoJ said it will also be reviewing those MROs that have registered as tier-one providers to check if they are ‘overstating their capabilities’.

Richard Mason, deputy director for civil justice at the MoJ, spoke at last week’s MedCo board meeting to outline his concerns.

Any company which has applied for tier-one status must show the ability to process at least 40,000 reports a year.

One of the biggest MROs, Speed Medical, was reported last month to be appearing in 45% of searches, having registered at least entries for the second tier.

Dan Chesney, group marketing manager, said the company was facing a huge drop in medical requests and had to act to protect the jobs of some 200 employees.

MedCo said it has started auditing registered companies to ensure compliance.

A spokesman said: ‘The MedCo board recognises that this is a rapidly evolving market and that some behaviours, may undermine the original policy intention. Processes will be updated in the future to address these concerns and users will be notified.’