Can an attorney-in-fact under a Power of Attorney spend your money if you are in a nursing home?

It depends on the type of POA you gave them (in the UK there is a special type called an enduring power of attorney) and in this case the money can only be spent for your benefit (i.e. paying your nursing home bills etc). If you are worried talk to a solicitor/attorney.

Another Perspective

The principal's money should always only be spent for the benefit of the principal. A power of attorney grants sweeping powers over all the assets of the principal and many principals have been taken advantage of by their agents. If you suspect that you or someone you know who is in a nursing home is being taken advantage of by their attorney-in-fact, you should speak to the authorities immediately.

You should speak with the social worker at the nursing home or the patient's attorney. An attorney-in-fact is a fiduciary and as such is governed by the laws that control the conduct of fiduciaries. They cannot convert any funds belonging to the principal to their own use. A dishonest attorney-in-fact can wipe out savings quickly. The POA should be revoked immediately and a copy of the revocation should be delivered to any facility or entity that has accepted the POA in the past.