This is very similar to the problem that Inner Beast had. As long as you have an ability that costs you dps to use, the average player isn't going to want to use it. At the same time, you can't pretend like it doesn't exist defensively. In Clemency's case this is exacerbated by the fact that this expansion, Holy Vampiric Spirit/Holy Vampiric Circle now have a built in 400 potency lifesteal effect. And when you factor in the difference in MP costs (Clemency costs double the amount of Holy Vampiric Spirit/Circle), it looks like Clemency's primary value comes from spot healing another target.
It's fine for Clemency to stay. It makes sense for Knight/Paladin to be able to cast simple White Magic support spells. What they should do is get rid of the vampiric effects on Holy Spirit/Circle which make no sense thematically. Then, create a proc off of say Sheltron/Intervention that makes your next cast of Clemency instant and free. Now you have a natural way to top yourself off after mitigating a big hit. But you still have the option on reserve to sacrifice personal DPS to keep someone alive in a prog scenario. If they're worried about setting limits on healing output, just place an upper limit on the number of times you can get a free proc per minute.