Talks aimed at averting a cabinet crisis after three Labour senators voted down controversial health insurance reforms, continued on Thursday, with both sides showing more optimism that a solution will be found.

Prime minister Mark Rutte cancelled plans to attend an EU summit because of the crisis. Rutte has asked Luxemburg’s prime minister to speak at the conference on his behalf and foreign minister Bert Koenders has gone to Brussels to brief him, news agency ANP reports.

Rutte said on Wednesday evening that the talks ‘could lead to a positive outcome’, while Labour party leaders said they are ‘hopeful’.

On Wednesday, everyone involved worked ‘step-by-step to reach a solution’, Rutte said but declined to give further details ‘in the interest of the negotiations’.

‘There is not yet a solution but the talks are constructive,’ Labour leader Diederik Samsom said after talks with Rutte in his offices.

The three senators on Tuesday refused to vote in favour of legislation which will allow health insurance companies to restrict freedom of choice among patients to doctors and healthcare providers they approve of.

Opponents say the measure will give too much power to health insurers. The market is dominated by four main players.