Once you take responsibility as Power of Attorney, you are responsible for all her bills and care. My wife had power of attorney of her grandmother and she had to make sure ALL her bills were paid and that she was well cared for until she passed.The poster here who said you are not personally financialky responsible is right. You said the prior person with POA drained her assets. If that happened inside the last two years that it why she was denied Medicaid. She will eligible for Medicaid two years after the last of her assets were taken.
Meanwhile an attorney needs to sort this out. Obviously the nursing home has to be paid. The prior POA violated their responsibility and needs to pay...
Now each state maybe different in their laws, so if I was you I would contact the lawyer or who ever in your area that knows about power of attorney. You can also work out a payment arrangement too!

