Cllr James Halden, Thurrock Council's portfolio holder for Heath, said: "We have worked hard with the NHS and I am delighted their decision reflects our understanding that Orsett Hospital will not close until our four new integrated medical centres are up and running and services are available.
"The council and NHS partners are investing about £80million to co-locate out-of-hospital and GP services together, to best serve local people."
Tom Abell, Deputy Chief Executive of Basildon Hospital, which owns the Orsett site, said: "Today's decision means the site will close when new facilities are open. The services people currently rely on in Thurrock will stay in Thurrock.
"We will now work with our patients to decide the best place to provide their services locally. I am looking forward to working with a Thurrock residents 'people's panel' very soon to get this under way.
"I would encourage any current patients, their families and carers to look out for this and get involved."