Newly appointed permanent secretary of the Department of Health, Mike Farrar, made the comments during health committee evidence.
Farrar said health's percentage of total expenditure had grown from 46% in 2016 to over 50% currently and would rise at current trends to 75-80% by 2050.
‘It simply isn't tenable to carry on in that sense,' Farrar said. ‘We have to get value for the money that we have. We have to effectively reset the way that our system works.'
Farar said Northern Ireland would be shifting to a prevention and neighbourhood health model in order to reduce demand on hospital services.
The civil servant added the £200m current pay agreement ‘was not affordable within current arrangements'.
In earlier evidence health minister Mike Nesbitt warned of the difficulty in reaching breakeven from the current £600m deficit position ‘through efficiency and service reconfiguration alone'.
Nesbitt added the department did not have the extra £80 demanded by the BMA for an increased pay award.