The governing Liberals and Ontario Medical Association agreed late Wednesday to restart negotiations on a new fee agreement for doctors.
Both sides said they're confident a new agreement can be reached that is in the best interest of patients, and is fair to both taxpayers and doctors.
Talks between the province and the OMA, which represents 25,000 doctors, broke off earlier this year and the government made regulatory changes to cut Ontario Health Insurance Plan fees and premiums.
The OMA had said it offered to freeze doctors' fees for two years and find an additional $250 million in savings, but Matthews rejected the proposal.
Matthews said she feels more confident that they can reach an agreement together that will protect health care in the province while fighting a $15-billion deficit.
"We broke up for awhile," she said, adding that she wasn't "enthusiastic" about imposing the fee cuts.
But the two sides continued to talk informally and "reality set in" for the OMA, she said. It understands that the province has a "fiscal challenge" and that it's better to work with the government to resolve it than have it imposed.
"I think it needed some time," Matthews said. "This is an unusual negotiation because we're not talking about how much more we're going to spend."
In a letter to its members Wednesday, OMA president Dr. Doug Weir noted that the government agreed to third-party facilitation and conciliation if needed.
It was a sticking point for the OMA, who said the government had previously refused all their requests to bring in a conciliator.
"The board believes that the government has demonstrated openness that will ensure a more meaningful negotiations process," Weir said in the letter.
The Eye Physicians and Surgeons of Ontario expressed relief that the government agreed to return to the table.
"The litany of cuts imposed by the Ontario Ministry of Health has been sounding alarms across the province and is being questioned by patients, patient groups and practitioners alike," the group said in a statement.
"The cuts have already affected access to care in various disciplines and have left doctors and patients with a shaken faith in our health-care system."
It's not yet clear when negotiations between the OMA and the government will officially begin.