The Cabinet has agreed the current deal with private hospitals will not be extended beyond the end of June.

It will instead seek to negotiate a new agreement which will allow full access to these hospitals if a second wave of Covid-19 occurs.

This new deal would also provide for the use private hospitals for some non-Covid services.

The Department of Public Expenditure and Department of Health are aiming to negotiate this new agreement between now and the end of June.

Speaking after a Cabinet meeting, Taoiseach Leo Varadkar said that the Government stands over the decision to take control of private hospitals.

Mr Varadkar said the way the contract was constructed was that private hospitals would not make a profit but that any costs incurred would be covered. 

He said the contract they want to move to at the end of June would allow them to step in again and take control of ICU and critical care beds if needed, and pay per item for work done for public patients in private hospitals.

The Private Hospitals Association has welcomed the decision, saying the partnership helped combat Covid-19 and flatten the curve. 

In a statement the PHA said its members will now "commence the process of preparing for the full resumption of private care provision nationwide from the beginning of July."

Chief Medical Officer Dr Tony Holohan said the arrangement with private hospitals was a "very important part" of the country's capacity for a so-called surge in virus cases.

"We managed to avoid that by the suppression of the disease and the work of the whole population," he said.

Dr Holohan added that ending the contract with private hospitals will not effect responses to any surge in cases.

"If it became necessary to quickly increase the capacity of hospitals, we think we would still be in a position to do that," he said.

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The Government reached an agreement in March with the Private Hospitals Association to use its facilities for the treatment of both Covid-19 and non Covid-19 patients.

Minister for Health Simon Harris said the partnership represented a 17% increase in capacity for the Irish health service.

Under the deal, 19 private hospitals are essentially being operated as public hospitals.

But there had been calls from Opposition politicians and consultants in the health service for the current arrangement to be ended.

Earlier this month, the Health Service Executive CEO Paul Reid said the executive would use private hospitals to "help clear the National Treatment Purchase Fund (NTPF) lists".