Governments and the National Disability Insurance Agency need to start planning now for a changed timetable, the Productivity Commission said in a report released on Thursday.
It has been estimated 475,000 Australians will be covered by the scheme.
Both the Turnbull government and Labor, which established the scheme, preferred to talk about how the NDIS was operating within budget.
Recommended reading
Morrison summons 'better angels' over NDIS
Social Services Minister Christian Porter said the government welcomed the commission's report and did not dispute any of its findings.
"The report highlights a range of reforms that we have already undertaken," Mr Porter told reporters in Canberra.
"Particularly reforms designed to make the experience of coming into the scheme as good as it can be."
The report found the transition phase focused too much on quantity, at the expense of quality.
Opposition social services spokeswoman Jenny Macklin also welcomed the report.
"The NDIS is a once-in-a-generation, groundbreaking reform," she said, acknowledging there was still a number of issues that needed to be addressed as a matter of urgency.
"There are people with disability who are not getting the services they need."
Ms Macklin cited the lack of staff at the NDIA because of a cap on numbers.
"It is severely restricting the capacity of people with disability to get into the scheme and get the services they need," she said.
Ms Macklin also noted the "shocking bungling" of a new IT system that caused delays.
The report calls on governments to set clearer boundaries around who supplies what to people with a disability and to only withdraw services when continuity of service was assured.
