Maybe it's just a little more convenient for Priests to use power leveling Flash Heal instead on present encounters. I remember running Karazhan with T5 and up gear. I got lazy and just flashed more often because my regeneration allowed me to do that. I have a hunch that may be the case here for some players.

In the grand scheme of things, we have just started raiding. The only power leveling direction our health pools can go is up. Feral Druid tanks are breaking the 50k health barrier. As instances become harder, I suspect Greater Heal will see increased usage.

Either that, or raid groups are stacking way more healers then are necessary. An entry level raid will pack 6-7 healers. A group with Naxx on farm will be equipped with 5-6. I would say power leveling 4 healers, but I have never been able to successfully heal a heroic Patchwerk with under 5 healers (20% was the closest for me).

In any case, the use of Greater Heal may be dying. But I don't believe it's quite dead.