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Hello Nikolaos
The first sentence is the correct one. Since we are speaking about a situation that is changing, our aunt's changing health, we use a continuous verb form: the present continuous.
All the best
Kirk
The LearnEnglish Team
Hello hungrymoon
You're very welcome -- best of luck with your studies and on your TOEFL exam! You might also want to consider some of our free courses on FutureLearn. Even though many are specifically about the IELTS, you might find them useful.
All the best
Kirk
The LearnEnglish Team