"Healers are spellcasters who swear solemn oaths to heal the afflicted and cure the diseased. When threatened, they defend themselves with reason and disabling attacks and magic, relying on deadly force only in extreme circumstances." (Morrowind player's manual)

The Healer's strengths lie in the ability to avoid a dangerous situation, either through talking your way out of it or using Illusion to bypass it. If those two don't work, the Healer has reasonable combat skills. The lack of Block skill probably means that the designers intended for the Healer to carry a two-handed weapon, such as a staff. Healing magic and alchemy round out the skill set. I find Hand-to-Hand to be almost useless in Morrowind, though it does allow you to knock out your opponent and run.

Specialization Magic
Favored Attributes Willpower, Personality
Major Skills Restoration, Mysticism, Alteration, Speechcraft, Hand-to-Hand
Minor Skills Illusion, Alchemy, Unarmored, Light Armor, Blunt Weapon
Starting Spells Hearth Heal (20-80 points)
Shield (5 points for 30 seconds)
Water Walking (60 seconds)
Almsivi Intervention (teleport to nearest Temple)
Divine Intervention (teleport to nearest Imperial Shrine)
Detect Creature (detect animal within 50-150 feet for 5 seconds)

Combat Blunt Weapon
Magic Restoration, Mysticism, Alteration, Illusion, Alchemy, Unarmored
Stealth Speechcraft, Hand-to-Hand, Light Armor

Strength Blunt Weapon
Intelligence Alchemy
Willpower Restoration, Mysticism, Alteration
Agility Light Armor
Speed Unarmored, Hand-to-Hand
Personality Speechcraft, Illusion