Elizabeth Edwards Faces Custody Controversy

Elizabeth Edwards is denying new reports that her health is failing and she is making plans for the care of her children after her death.  INSIDE EDITION has the latest.

Elizabeth Edwards said "not true" about a published report that she wants her oldest daughter to care for her two young children if she dies instead of estranged husband John Edwards.

"There is no truth whatsoever to the story that I am trying to deny John custody of the children after my death," Edwards wrote in an e-mail.  

The report claimed Edwards was grooming her 28-year-old daughter Cate to raise 12-year-old Emma and 10-year-old Jack.

Cate is a Harvard-educated lawyer who campaigned for her father in 2004 and is now clerking for a federal judge in Alexandria, Virginia.   

Edwards is battling terminal breast cancer and her sister denies her condition has taken a turn for the worse, saying,  "She's healthy right now. She's not dying. She's doing extremely well. She's undergoing treatment."