Taoiseach Brian Cowen has said the Government recognised concerns over the medical card controversy, but it needed time and space to try to find a solution.
Speaking on RTÉ Radio's This Week, he said the changes proposed in the Budget will not go ahead, as they stood.
But he said any solution would have to recognise the broad parameters of the Budget, and include a means test, because the escalating cost of automatic entitlement was not sustainable.
Mr Cowen said he wanted to find a solution that was broadly acceptable and targeted those most in need.
The Taoiseach said sometimes it was difficult to communicate the extent of the radically changed economic situation, but the Government had to try to stabilise the public finances.
The Taoiseach has also said he will not travel to China until Tuesday night instead of today as planned.
He said Minister Batt O'Keefe would go ahead to lead the delegation until he arrived.
FF councillors express anger at card move
Meanwhile, a meeting of Fianna Fáil Councillors in Galway has ended after over four hours.
Chairperson of the Fianna Fáil National Councillor's Forum Deirdre Forde read a statement to the media expressing their anger that anyone over the age of 70 would have their medical cards taken away.
She said: ‘Following communication with the Taoiseach this evening, the Fianna Fáil National Councillors' Forum urged him re-address the budget proposal immediately in light of our members views.’
Earlier, Cllr Arthur McDonald the Leinster chairman and National Vice-Chairperson of the Fianna Fáil Councillors Forum said that with an election coming next year councillors have to make a decision whether they will support the Budget 100%.
Following today's meeting, he said, councillors intend to send a delegation to meet Mr Lenihan ahead of a meeting of the parliamentary party next Tuesday.
Ex health minister urges card rethink
Former Fianna Fáil Minister for Health, Mary O'Rourke, called on the Government to look again at the medical card system.
Mrs O'Rourke also said that the country is in a dire economic situation and the sooner people wake up to that the better.
Meanwhile, Fianna Fáil backbenchers have been voicing their opposition to the measure.
Wexford TD Sean Connick said the withdrawal of the automatic entitlement had spread fear among constituents.
Mattie McGrath of Tipperary South said he and a number of colleagues were working to have the measure withdrawn and re-examined.
Opposition parties have again called on the Government to scrap the medical card plan.
Fine Gael leader Enda Kenny said Mr Cowen had failed to deal with the fears of older people, by indicating the proposed end of automatic entitlement would proceed, with some changes.
Labour Leader Eamonn Gilmore said the ‘tinkering’ around with income limits would not satisfy the public.
Age Action Ireland has said it was disturbed that the abolition of universal entitlement was proceeding, and it was continuing to prepare for a public meeting in Dublin on Tuesday to protest at the move.
The row has cost the Taoiseach the support of one TD, Wicklow's Joe Behan who has resigned from Fianna Fáil, and which may well cost him the vote of Independent Finian McGrath.
Deputy McGrath told RTÉ News he had informed Mr Cowen's office that he was 'out of there' unless the plan was scrapped.
Many backbenchers have reported a bruising round of constituency clinics yesterday, which left them in no doubt about public anger.
RTÉ Political Correspondent David McCullagh says the Government is expected to win a vote on Wednesday on a Fine Gael private members motion criticising the medical card proposal.
However Mr McCullagh says passing the actual legislation to remove the automatic entitlement to a medical card for the over-70s could turn out to be a different matter