First, please accept our condolences on your wife's passing.
Yes, you would still need to include the income from this 1099R on your joint tax return.
But bear in mind that her long-term facility costs are probably deductible, if you itemize deductions.
According to IRS Publication 502,
relating to Nursing Homes,
You can include in medical expenses the cost of
medical care in a nursing home, home for the aged, or similar institution, for
yourself, your spouse, or your dependents. This includes the cost of meals and
lodging in the home if a principal reason for being there is to get medical
care.
Don't include the cost of meals and lodging if the
reason for being in the home is personal. You can, however, include in medical
expenses the part of the cost that is for medical or nursing care.
Please see the
TurboTax article Can
I Claim Medical Expenses on My Taxes? for additional information on
claiming a medical deduction.