I've been there with this, with my great-aunt. I became the decision-maker in this situation, and the one who was there for my aunt.
She too broke her hip first and wanted to return home. We talked about this, and I promised to ensure she would return there if she first went to a convalescent centre in a retirement/nursing home type of place, but I found one that was more upscale and to her liking, but then, she did have the funds, so that made this much easier for me.
Sometime after she returned home she began to develop dementia. We (as a family) continued to monitor this, since I knew she wanted to remain at home for as long as possible. She had another 'incident' involving a fall and a small fracture, and this time, due to her increased dementia and her temporary disability, I decided, along with her doctors, nurses, and physio at the hospital that it would be nearly impossible for her convalescence elsewhere and then return home.
Since she was still able to understand the situation in between bouts of minor confusion, I came into the hospital frequently and had discussions with her about this while she was recovering there. Through this she was gradually able to understand that she was unable to return to her home and that, this time, plans would need to be put into place to transfer her to a permanent home where she would live out her remaining days. What I did was ask her if she had any wishes when it came to this, and what she did want was a private room, so I arranged this for her, but as I stated, she did have the means to pay for this. And, although she did wish to remain at home, she had told me earlier on that she didn't want to live with anyone and become a burden to them, since she'd had that done to her as a young bride and felt that she'd lost a couple of decades of her life while being forced to care for her elderly in-laws so she didn't want to 'inflict' that on anyone else. So again, this did make it easier for me, even though I didn't have space in my home for her (my kids were already doubled up).
I've always found, either through personal circumstances or through my working experiences in nursing, that it's best to always involve the person in these decisions. This might not go well, but at least there aren't any surprises for them so when they do reach their final destination the adjustment will eventually come easier.
Just my thoughts on this.
"Why fit in when you were born to stand out?" Dr. Seuss
"Your beliefs don't make you a better person, your behaviour does." (unknown)
"If everyone is thinking alike, then somebody isn't thinking." George S. Patton
The poster formerly known as Writer Mom (stolen from Prince)