The better geared and experienced your raid is (especially the tanks), the less HL spam is necessary, at least in a 3/10 or 7/25 setup. When you start going for achievements and/or dropping a healer, it regains usefulness (from what I hear). If you're running with your guild's less-geared raid team, and it's melee-heavy to boot, the ability to throw constant glyphed HL for a significant amount of time can be a literal (toon) lifesaver.
As for overheal, I don't worry about it as long as I don't run OOM. If I can keep the HS tank up until Patchwerk's enrage timer, does it matter? Sometimes a scalpel is the best tool for the job, but most of the time I feel safer with a cleaver...
That said, since one of our hunters respecced SV after the patch and can provide Replenishment (we have a grand total of 0 shadow priests and 0 pallies mainspecced ret), I mix FoL and HL about evenly on most bosses and never get below 80% - but when the OT loses control of adds and chaos reigns, it's nice to know that I can do HL back-to-back for a solid minute, then go back to my normal rotation when control is re-established.