Yes, someone applying for Medicaid coverage of nursing home caremust disclose to Medicaid any assets they have, regardless of what form the assets are in or where they are physically located. So, if your grandfather still owns the New York house when he applies for Medicaid nursing home coverage in Florida, he will have to disclose his ownership and his equity in the house. If he has already sold the house by the time he applies for Medicaid coverage, he will have to disclose the money he has received for it -- to the extent he hasn't spent it by that time on legitimate expenses for himself -- regardless of where he keeps that money.
If, at the time he applies for Medicaid coverage, his assets are too high for him to qualify for nursing home coverage, he will have to spend that money down to Medicaid asset eligibility levels before he will qualify for coverage. However, if his equity in the house becomes available to him before he applies for Medicaid, he can spend some or all of that money for any legitimate purpose -- such as paying for in-home care to take some of the burden off you and your family, allowing him to stay at home longer -- and still later qualify for Medicaid. He cannot, however, simply give the money away or "spend" it in transactions that are not legitimate, fair market value exchanges.
One thing you might consider is having your grandfather pay you to care for him -- if he's willing to do so -- before he has to enter a nursing home. That can be a legitimate expense under Medicaid rules, as long as the rate of pay is reasonable for the care provided, based on the amount that paid in-home caregivers receive in the area where you live.