This essay examines the state of Artificial Intelligence (AI) based technology applications in healthcare and the impact they have on the industry. This study comprised a detailed review of the literature and analyzed real-world examples of AI applications in healthcare. The findings show that major hospitals use AI-based technology to enhance knowledge and skills of their healthcare professionals for patient diagnosis and treatment. AI systems have also been shown to improve the efficiency and management of hospitals´ nursing and managerial functions. Healthcare providers are positively accepting AI in multiple arenas. However, its applications offer both the utopian (new opportunities) as well as the dystopian (challenges). Unlike pessimists, AI should not be seen a potential source of "Digital Dictatorship" in future of 22 century. To provide a balanced view on the potential and challenges of AI in healthcare, we discuss these details. It is evident that AI and related technologies are rapidly evolving and will allow care providers to create new value for patients and improve their operational efficiency. Effective AI applications will require planning and strategies that transform both the care service and the operations in order to reap the benefits.