If you don't want the arch, you'll have to remove it. Otherwise, paint it the same color as the rest of bricks. Hang a gorgeous piece of art in the space.

I wonder how this brick like surface is constructed? Can you remove the bricks that form the arch design? If not, I would remove this brick and develop plan for new facade.

Take it, and the hearth off.

Too bad it was painted. I'd plaster over the whole thing, including the hearth. Based on your photo, it looks like your home could support an adobe-style fireplace. Here's one that was over an old painted fireplace. This picture is offered to show plaster style, not the exact style you might choose/need. I'd go right over your existing hearth so as not to ruin your tile floor. II'd break off the most protruding level of arch, and plaster over the rest. Hope this gives you some ideas!

A fresh take on an adobe fireplace · More Info

I would just work at removing all the added brick that forms the arch and also the top layer of the hearth and all around the firebox then you would have asurface you could tile over and honestly I would not even consider keeping the arch.

Agree with @Patricia Colwell Consulting. ^^^

Was going to and am suggesting as Peter Barnard and mimimomy suggested. I like the arch. And think it can become the star of the whole FP if done right. I’d cover the brick with cement. Stone. Stucco...

Have an experienced mason out to knock off the brick arch and any other decorative bricks and then do a German Mortar Smear over the entire brick face. It will look great in the room.