This is the second annual report on the Money Follows the Person (MFP) demonstration, a federal initiative to help states reduce their reliance on institutional care for people needing long-term care and expand options for elderly people and individuals with disabilities to receive care in the community. During 2010, MFP increased the number of Medicaid beneficiaries transitioned by more than 50 percent over the previous year and expanded into 13 additional states. By the end of 2010, nearly 12,000 beneficiaries transitioned to community living through MFP programs, and participants generally fared well in the community and improved their quality of life.