The rapid advancements in Artificial Intelligence of Things (AIoT) are pivotal for the healthcare sector, especially as the world approaches an aging society which will be reached by 2050. This paper presents an innovative AIoT-enabled data fusion system implemented at the CMUH Respiratory Intensive Care Unit (RICU) to address the high incidence of medical errors in ICUs, which are among the top three causes of mortality in healthcare facilities. ICU patients are particularly vulnerable to medical errors due to the complexity of their conditions and the critical nature of their care. We introduce a four-layer AIoT architecture designed to manage and deliver both real-time and non-real-time medical data within the CMUH-RICU. Our system demonstrates the capability to handle 22 TB of medical data annually with an average delay of 1.72 ms and a bandwidth of 65.66 Mbps. Additionally, we ensure the uninterrupted operation of the CMUH-RICU with a three-node streaming cluster (called Kafka), provided a failed node is repaired within 9 h, assuming a one-year node lifespan. A case study is presented where the AI application of acute respiratory distress syndrome (ARDS), leveraging our AIoT data fusion approach, significantly improved the medical diagnosis rate from 52.2% to 93.3% and reduced mortality from 56.5% to 39.5%. The results underscore the potential of AIoT in enhancing patient outcomes and operational efficiency in the ICU setting.