A heat and moisture exchanger for both conducting a stream of air produced by a ventilator to a moisturizing medium and internally bypassing the moisturizing medium if aerosolized medication is introduced into the stream includes a housing having a ventilator-side port coupled to an outlet of a ventilator and a source of aerosolized medication. The housing has a patient-side port for coupling to a patient to provide ventilation including either air or air carrying aerosolized medication. A first path conducts air from the ventilator-side port through the moisturizing medium and the patient-side port, and a second path conducts air carrying aerosolized medication from the ventilator-side port directly to the patient-side port. A two-way valve mechanism in the housing selectively couples the ventilator-side port into fluid communication with one or the other of the first and second paths.