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Good luck to you and warm hugs.
If you are comfortable that the AL is right for your Mom, bring in a hospice organization to assess your Mom. They have a lot of experience and can supplement the processes from the AL. They can provide an aide for your Mom up to 5 Xs a week and a nurse's visit weekly (or more as necessary).
I don't see any indication that your Mom needs nursing care from a SNF. Maybe she just needs more services from the Al. Think about it.
When considering adding on to your house and bringing her home, keep in mind that moderate dementia generally becomes severe dementia over time. It isn't enough that you feel you can handle her care now. Could you handle it when the dementia gets worse? Timelines are just not available! She may stay at a moderate level of dementia for years or she may start to decline next month. What is the prognosis for her liver cirrhosis?
If you do decide to bring her home, talk to a local real estate agent about how best to maintain your home value with the addition you will build. Also think ahead to how that space could be incorporated for different uses some day. If you consider moving Mom to skilled nursing look for a place where she could easily transition to dementia care if that ever becomes necessary.
The fact is, caregivers need a good crystal ball, and, darn, we are not issued one!
Bless you for doing your best to do the right thing. Our best is all we can ever do.
My 82 year old mother who also had dementia, but mostly on the mild side, just passed away (11/17/12) in the very early AM....just after midnight, primarily from congestive heart failure but had many complications (pneumonia to name one big one) and her body just broke down. She had entered an ALF in September after 90+ days of rehab for knee surgery during which time she had a couple of hospitalizations. And then during October and November she was mostly at the hospital and we finally had to move her to hospice. She just could not get well, was very weak, had lost about 50 lbs, and was ready to meet the Lord. Unfortunately she was alone (in terms of family at her bedside) when she died and I was flying to be with her the day she died. I have a brother who lived in the area and took care of things locally. I just couldn't get there in time, but then again, I don't think she wanted me to see her pass. I will miss her so very much.
I wish you all the best in your search for the best care of your mom.