Tory minister Iain Duncan Smith wants to make it easier to slash the benefits of 550,000 seriously ill people, the Observer has claimed.
He is said to be plotting to scrap the Work Related Activity Group (WRAG) for Employment Support Allowance (ESA) claimants, including people with diseases such as cancer.
The government categorises ESA claimants on their supposed ability to work. The WRAG is for those judged not fit for work now, but potentially later.
They can have part of their benefits docked if they do not take part in activities such as writing CVs.
But the government is concerned that too many people stay in the group for longer than it intends.
Ill people kicked off the WRAG could be subject to the same harsh conditions as people on JSA.