Controversial plans to locate private hospitals on public hospital lands today received the backing of the Irish Medical Organisation (IMO).
However, the IMO warned there could be no loss of funding and investment in public hospitals as a consequence of co-location.
It said the State should hold part ownership of private hospitals built on public land or those developed with State-assistance through, for instance, tax concessions.
The IMO said the voluntary not-for-profit hospitals was a successful model and could be used to develop independent hospitals.
Dr Sean Tierney, chair of the IMO consultant's committee
If a for-profit model is adopted, then the profits should be capped and the money raised reinvested by the State in healthcare, it added.
Priority should be given to space for elective care such as surgery, orthopaedics, cardiology and the planned treatment of chronic disease.
Dr Sean Tierney, chair of the IMO consultant's committee, said there has been a lack of bed capacity in the system for some time and that co-location could not lead to private patients being prioritised ahead of public patients.
"The failure of the HSE [Health Service Executive] to recognise and react appropriately to the lack of capacity has exacerbated inequity in the system," Dr Tierney said.
The IMO says there are less 2.9 acute hospital beds per thousand population - one of the lowest ratios in the developed world.
Minister for Health Mary Harney told the Dáil last week that co-location would save the taxpayer up to €500 million and would lead to a speedier delivery of hospital beds.
The board of the HSE is due to meet on Thursday to approve the successful bidders for six co-located sites that have already bee put out to tender.
The tenders were for the development of private facilities on the lands of St James's, Beaumont and Tallaght hospitals in Dublin; and Sligo General, Limerick Regional and Waterford Regional hospitals.
When the co-location was first announced, Ms Harney said up to 1,000 beds assigned to fee-paying patients in public hospitals will be freed up by co-location.
She told the Dáil last week that the shortfall in funding for public hospitals caused by the loss private patients would be offset by leasehold income from the land, and a share of the private hospitals' profits.
Opponents of co-location say it will not achieve the savings anticipated and that the inequity of the existing two-tier health system will be exacerbated.
Sinn Féin Dáil leader and health spokesman Caoimhghín Ó Caoláin today said the co-location the plan was based on false figures.
"The figure of 1,000 is a mirage which is being used to deceive the public.
"The Government and HSE are taking the biggest single step so far towards the privatisation of our health services by opening the door to multinational privateers who operate on the basis of shareholders' profits and not patients' needs," Mr Ó Caoláin said.
He also noted the parent companies of the applicants are "mired in fraud in the United States".