My wife is going in a nursing home. Do I have to divorce her so we don't lose everything?

Not a fun topic, but a question that comes up frequently.  I'm sorry that you're going through such a tough time.  If it is a long term marriage, the answer is probably not, since the outcome may be better to stay together.  Alabama Medicaid requires that the divorce be equitable in this case, so it would simply result in a property division, with the nursing home spouse having to spend theirs on the nursing home.  In most cases, the long term couple will be better off following rules for couples.  The spouse at home (community spouse) can keep all of their income or, if the spouse in the nursing home (institutionalized spouse) has the higher income and the community spouse has much less, often a portion of the institutionalized spouse's income is diverted to the community spouse each month, up to a certain amount.  The community spouse can keep the home, and should have the institutionalized spouse's portion transferred to himself in this case.  The community spouse can also keep at least $25,000.00 in assets.  If the assets are more than $50,000.00, but less than $219,020.00, then those assets are split, with one half paid for nursing home care, and the community spouse retaining the other half. 

For those in a second or later in life short term marriage, if the community spouse brought in an overwhelmingly larger amount of assets to the marriage, then divorce might be an option to preserve them.  All people contemplating a later in life marriage should have a prenuptial agreement in place for this very reason. 

I hope you don't have to go this route, but its certainly something older couples should think about ahead of time, and do some disability planning to avoid an emotionally upsetting and expensive venture into domestic court.  Call an elder law attorney in your area to see how your state handles this issue, and keep in mind that many states will have different laws and rules governing these problems, but community property states will handle this issue quite differently.   Go here to find your local Area Agency on Aging, who should be able to get you in touch with an experienced elder law attorney.

Good luck and thank you for your question!