The rapid evolution of the Internet of Things (IoT) has strongly impacted healthcare, promising transformative advancements in patient care, administration, and system efficiency. This review conducts a thorough analysis and synthesis of IoT integration in healthcare, aiming to explore the potential advantages, challenges, and emerging trends at the convergence of IoT and healthcare, focussing on interoperability, security, and future prospects. The exploration begins with interoperable systems in healthcare, recognizing interoperability as vital for seamless data exchange among diverse healthcare systems and devices. Key advancements and challenges in achieving interoperability are highlighted, emphasizing the need for standardization and efficient data-sharing protocols to facilitate integrated healthcare solutions. Security in IoT-enabled healthcare systems is then examined, given the rising support for interconnected devices and data exchange. Safeguarding the privacy, integrity, and confidentiality of healthcare data is addressed, encompassing various security challenges, both technical and privacy-related. Evolving security solutions and practices crucial for protecting sensitive healthcare information are discussed. Furthermore, the review underscores emerging trends in IoT and healthcare, encompassing Explainable Artificial Intelligence (XAI), AI integration for enhanced authentication in IoT-5G healthcare devices, IoT applications in air quality monitoring, pandemic management, and precision agriculture. The transformative potential of these trends in healthcare delivery, patient monitoring, and disease management is explored, providing a glimpse into the future landscape of IoT-driven healthcare. In conclusion, this review offers a comprehensive understanding of IoT’s current state in healthcare, emphasizing the necessity for robust interoperable systems and stringent security measures, and envisioning the transformative potential of emerging trends.