Generally speaking, making sure nobody dies due to lack of HP is the healer's #1 priority. DPSing is #2.

It doesn't matter if people are taking unavoidable damage or tank is not using CDs properly. Just make sure they don't die. Yes, people should avoid unnecessary damage and the tank should use proper mitigation. However, this isn’t a good excuse to let them die. Not letting someone die > a healer casting an extra DPS spell.