Step-by-step explanation:
Reported speech: I am ill.
Reporting part: She says,
‘She says’ will remain as such.
As the reported speech is a statement, conjunction ‘that’ will be used to connect the indirect reported speech.
‘I’ will change, as per the subject of reporting part, into ‘she’.
Tense in inidirect reported speech will not change as verb in reporting part is in present tense.
So we get: She says that she is ill.