Israeli Prime Minister Benjamin Netanyahu told American broadcaster CBS Evening News that they had "strong indications" hostages were held at al-Shifa hospital.
"We had strong indications that they were held in the Shifa Hospital, which is one of the reasons we entered the hospital," he said.
"If they were [there], they were taken out," he added.
Israeli military raided the hospital, which is Gaza's largest, for a second day Thursday. Israel says Hamas militants maintain a command node at the hospital.
That claim has been denied by hospital staff and Hamas militants, considered a terror organization by the US, EU and others.