Fierce fighting has continued around al-Shifa hospital in Gaza City, as Israeli troops battled Hamas militants after seizing control of the strategically situated medical complex in an early morning raid.

Witnesses reported multiple airstrikes and ferocious firefights as fears rose for the safety of hundreds of civilians in the immediate vicinity of the hospital.

Israeli military officials said troops were “continuing precise operations in the Shifa hospital to thwart terrorism” and had killed 20 Hamas militants there, including Faiq Mabhouh, whom they identified as the head of the operations directorate of Hamas’s internal security. At least 80 people were detained by the Israeli forces and one soldier killed in the raid.

The raid was based on “intelligence information indicating the use of the hospital by senior Hamas terrorists to command attacks”, Israeli officials said.

Separately, Joe Biden spoke by phone with Benjamin Netanyahu in their first call since mid-February. The White House said the US president and Israel’s prime minister discussed the situation in Rafah and efforts to increase aid to Gaza.

Netanyahu said the two men, whose relationship has become increasingly tense, had discussed Israel’s commitment to achieve all the targets it had set out for the war: eliminating Hamas; releasing all the hostages; and ensuring Gaza would no longer pose a threat to Israel.

This would be done “while providing the necessary humanitarian aid that helps achieve those goals”, Netanyahu added.

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The fighting and the devastation in northern Gaza has forced thousands of Palestinians to seek shelter at Shifa, living in makeshift tents in its grounds. Tedros Adhanom Ghebreyesus, the head of the World Health Organization, expressed deep concern about the fighting, which he said was “endangering health workers, patients and civilians”.

“We are terribly worried about the situation at Al-Shifa Hospital in northern Gaza,” he wrote on X. “Hospitals should never be battlegrounds.”

A reporter with Al Jazeera was beaten and arrested along with other journalists, the Qatar-based TV network reported.

Witnesses described the beginning of the Israeli operation in the al-Rimal area of Gaza City, where the hospital is located.

“Suddenly, we started to hear sounds of explosions, several bombings, and soon tanks started to roll,” Mohammad Ali, 32, a father of two, who lives just over a mile from the hospital, told Reuters via a chat app. “They came from the western road and headed towards al-Shifa, then sounds of gunfire and explosions increased.

“We don’t know what is happening, but it looked as if it was a re-invasion of the Gaza City,” he added.

Hamas said the Israeli military had committed a new crime by directly targeting the hospital buildings without concern for patients, medical staff or displaced people in it.

Gaza’s health ministry said the raid had caused a fire at the entrance of the complex, resulting in cases of asphyxiation among displaced women and children in the hospital.

“There are casualties, including deaths and injuries, and it’s impossible to rescue anyone due to the intensity of the fire and targeting of anyone approaching the windows,” the ministry said, as it accused Israeli forces of “another crime against health institutions”.

The claims made by health ministry officials, the Israel Defense Forces (IDF) and Hamas could not be independently verified.

During the morning, the IDF dropped leaflets and used social media to tell civilians to leave their homes immediately and travel along Gaza’s coastal road to al-Muwasi, an area 18 miles (30km) south designated as a “humanitarian island” by Israel.

There is very limited transport available in Gaza, and many residents of Gaza City, particularly children and elderly people, are weak after months without adequate food. It was not immediately clear how many would be able to comply with the Israeli instructions even if the ongoing combat allowed safe passage.

An Israeli raid in November on Shifa – Gaza’s largest hospital – drew widespread international condemnation and the new operation underlines the difficulties faced by Israel in Gaza as they seek to fulfil their declared war aim of “crushing Hamas”.

Since February, the IDF has returned to fight in parts of the territory that were thought to have been cleared of Hamas militants after fierce battles last year. Residents of Gaza City told the Guardian this month that few Israeli troops were stationed amid its ruined streets but had withdrawn to positions on the outskirts and at key road junctions.

Israeli forces have raided a number of hospitals in Gaza during a military campaign launched after the surprise attack by Hamas into southern Israel in which the militants killed 1,200 people, mostly civilians, and took about 250 others hostage.

The intensity of the offensive has eased somewhat in recent weeks but the death toll continues to rise. Israel’s campaign against Hamas has killed at least 31,645 people in Gaza, most of them women and children, according to the territory’s health ministry.

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Israel has repeatedly accused Hamas of using civilians as human shields by running military operations from hospitals and other medical centres. The militant group denies these claims.

After its November raid on Shifa, the Israeli military said it had found weapons and military equipment hidden there as well as a 55-metre tunnel in the basement. The IDF shared footage it said proved hostages had been held there, which Hamas also denies.

Evidence produced by the IDF did not appear to substantiate claims made before the raid that the militant group had built a well-equipped command centre in multiple connected bunkers beneath the hospital, though a long reinforced tunnel running deep underneath the complex was identified.

On Monday, the IDF said that it had found “funds intended for distribution to Hamas terrorist operatives, in addition to numerous weapons … in the hospital.”

Aid agencies have been working to restore services at Shifa for several weeks, but have found it difficult to reach northern Gaza to bring in equipment and supplies. Many humanitarian groups have accused Israel of deliberately holding up their deliveries with arbitrary checks, opaque decison-making and cumbersome bureaucracy – a charge Israeli officials vehemently deny.

The latest raid comes amid hopes that a ceasefire deal between Hamas and Israel can be agreed in a new round of talks expected to start within days.

• Reuters contributed to this report