My wife has been in a nursing home for the past 5 years with dementia. Before illness we were living together but separately. I have a life with someone and she had her personal life. Now I want to divorce and our daughter has POA so what would be my next step. She has been under Medicaid so this is not a fraud situation.

Thank you

So neither of you own a home or have any assets of significance?
Does her daughter know you want this, and if so, how does she feel about it?
What state is it?

I wouldn't do this without an attorney, even though I got a divorce without one.

Get an attorney, most likely they may want support for wife.