It auto heals if you rest. Otherwise, it just gets a smaller health boost from it's Burrow ability. It makes sense to me that if you get to heal from a long rest, it does too.
If you have misty step and invisibility, you can force it to fight the minotaurs every time.
When you approach it with one character by jumping over the small gap, across from the Myconid Colony, and turn based mode is entered, misty step as far as you can behind it, and it will end up too far away to enter combat. Then continue down that path until you reach the minotaurs, and they will trigger at the same time. After it knocks you over, cast invisibility.
It wins/loses/burrows about 1/3rd of the time each.
