They want to strengthen the rules governing the appraisal of surgeons to make it easier for managers to weed out cases of malpractice.
Paterson was jailed for 20 years after he was found guilty in April of 17 counts of wounding with intent and three further wounding charges.
Paterson’s trial heard how he lied to his patients and exaggerated or invented the risk of cancer to convince them to go under the knife. He also claimed payments for more expensive procedures.
Under the compensation plan agreed yesterday Spire Healthcare, the hospital group where Paterson treated his private patients, will contribute £27.2 million to the fund.
A further £10 million is to be provided by Paterson's insurers and his former employers, the Heart of England NHS Trust.
Approving the settlement, Mrs Justice Whipple expressed her "heartfelt " sympathy to those patients whose trust she said was "betrayed" by Paterson.
Now lawyers representing his victims have renewed their calls for a public inquiry into the scandal, saying tougher regulation of the private sector is needed.
Emma Doughty, a specialist medical negligence lawyer from Slater and Gordon, which represented more than 100 victims, said: "Paterson's private patients have faced a five year struggle to obtain the financial settlements they deserve and today they finally received confirmation that they have won their battle for justice."
She said: "We and our clients still hope that a public enquiry will be carried out to ensure appropriate regulation is put in place in the private sector for the future. We need to change the appraisal system to weed out surgeons like Paterson. It was clear things were going wrong for some time, but it was not picked up by his managers.”
Rachel Butler, from Lichfield, who was wrongly told by Paterson she needed surgery because she was at high risk of cancer, said: "It is a relief that we will now receive some form of compensation for the hell we've been through. We now need to see a complete change in the private healthcare sector to make sure no-one ever has to wait this long for justice again."
Hundreds of patients treated by Paterson at Spire’s two West Midlands hospitals between 1993 and 2012 had been due to take their case to the High Court next month.
The settlement is intended to stop patients taking legal action against the group and deal with any new claims from former patients.
But it means that Paterson’s private victims are having to accept less in compensation than their NHS counterparts, in order to avoid the potential risk of an even lower figure should the case have gone to trial.
Around 270 NHS patients received an average compensation payment of £62,815 each earlier this year, from a total settlement of £17.4m.
That compares to an average compensation payment of £49,600 for each of Paterson’s 750 private patients towards the long term costs of therapy and ongoing treatment.
Patients are angry it took Spire months to make their settlement offer.
The firm - the second largest provider of private healthcare in the UK, with an operating income of £108m last year - had argued until now that because it did not directly ‘employ’ the surgeon it should not be held responsible for his actions.
Kashmir Uppal, who has been pursuing claims on behalf of those injured by Paterson since 2010, said: “Paterson behaved with clear criminal intent and abused the trust of those he treated in both the NHS and the private sector and better clinical governance in both cases might have led to action being taken sooner.
“However welcome, no amount of money will ever heal the physical and mental scars inflicted on our clients but they are relieved that they have finally won their battle for justice.”
Ms Uppal added: “I hope this settlement will send a message to other private healthcare providers. It is now crucial that all the managerial failings, which allowed Paterson to do what he did for so long, are addressed to reassure the public that something like this can never happen again.”