Most states are expanding community-based care for people with disabilities over institutional options in an effort to rein in long-term care costs and meet consumer demand, a new survey finds.

The trend is detailed in a report released Thursday that’s based on a survey of Medicaid officials in all 50 states and the District of Columbia.

Overall, 29 states grew their home and community-based services programs in fiscal year 2011 and 27 states increased such offerings for 2012, according to the annual report from the Kaiser Family Foundation’s Commission on Medicaid and the Uninsured.

At the same time, the report found that plans to expand institutions came to a near halt.

The shift toward community-based services is being driven by cost concerns and pressure from consumers, the report found. Legal worries are also playing a role following a 1999 U.S. Supreme Court decision in Olmstead v. L.C. which found that people with disabilities have the right to choose to live in the community whenever possible.

In addition, the report found that three states — Alaska, Rhode Island and Washington — are already planning to participate in a new federal program that would give states additional Medicaid funding in exchange for eliminating caps on the number of individuals who can live in the community. The initiative known as the Community First Choice Option is part of the federal health care reform law passed in 2010 and begins this month.

Another 34 states indicated that they had not yet decided whether they would take part in the new program.

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