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She was diagnosed with a syndrome in which improvement is possible and that she has. My sister is not allowing my mom to make the decision to go home or even visit her own house. I don’t see how this is legal? My mom's name is on the deed.... why can’t she go there? And does my sister have this right?

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What's stopping her from getting up and leaving? Other than locked doors in a memory care facility, there's little that keeps someone from leaving a home. Physically that is.
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If your mom was previously diagnosed by a legitimate examiner as being “incompetent” or “unable to manage personal affairs”, but also as having a “syndrome in which improvement is possible” the status of the POA held by your sister MAY be subject to maneuvering on your mother’s part.

Although most people who are moved to care facilities “want(s) out”, IF your mother can make a case for potential for improvement to her condition, she MAY be able to revoke her designation of your sister as POA. Returning to her house MAY be based on your mother’s present cognitive status, and not on whether or not her name is on the deed to the house

She will need a lawyer to represent her own interests, and help both you and your sister get a clearer picture of her (MOM’s) rights.
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Where do you live? Are you anywhere near your mother? If not can you visit to truly understand the situation? You don't give any information on your profile to better understand the logistics of this situation.
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Is mom competent? If so, she can revoke the Power of Attorney and assign a new one. Someone more involved in her care would be best, anyway.

If mom is incapacitated in any way, the POA cannot be changed.
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