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It will only confuse and agitate a person who has a hard time adjusting to where they are every day, let alone to anything new. As soon as she gets semi-familiar with one place, she’s sent off to another. She’s already frail and moving is stressful, even more so for her.
It may be the best thing for others as far as caretaking goes, but it’s the worst thing for her.
Asking your MIL what 'she wants' doesn't stand to reason, since an AD sufferer isn't really able to use logic or reason anymore. My mother who's in a moderately advanced stage of dementia talks about needing to take care of 'the children' that her deceased sister told her to, when they spoke on the phone yesterday, so that's where SHE is at right now. The thought of moving her back & forth between 2 homes is not something I'd even consider, personally. Continuity & consistency is what keeps her as balanced as possible these days, truthfully.
You have to expect a decline with your MIL, it goes with the territory, unfortunately. She can become totally incontinent, wheelchair or bedbound, and delusional in the course of that decline. Your best bet is to have a Plan B on the back burner which is Memory Care placement or even Skilled Nursing, depending on her level of decline, should the need arise. Just be prepared, is my point.
You can always TRY moving her back & forth to see how it goes, but I would prepare myself for the worst if I were you.
Here is a link to a chart of AD stages that's quite comprehensive for you to refer to:
https://www.dementiacarecentral.com/aboutdementia/facts/stages/
Wishing you the best of luck with a difficult situation.
I did move Mom in with me, 20 months later an AL and 8 months later a NH. She adjusted well to all. I feel I was lucky. Change can cause further decline. Behaviour problems. As the desease progresses, she now does not recognize anyone and she is among strangers. You can try, see how it works. It may end up being better to place her in an AL near family eventually, if she can afford it.
If she adjusts this time that is great but she may not the next time.
If a permanent residence is not possible at either place it might be time to look at placing her in Memory Care where she will be able to remain in 1 location.