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Yeah, as far as I've ever been able to tell it works exactly like +/- dmg/heal. On the other hand, lots of mob abilities have a lot of weirdness going on in terms of what their coefficients are and how they react with this spell. I've never been able to find a systemic rule to explain it; it seems to largely be left up to the whimsy of whomever at Blizzard coded the spell/ability in question. I just test 'em out on each new encounter where they seem like they'd be useful.
By the buy, Dampen really shines on Illhoof. The full effect of the spell is applied to each tick of the demon chains, not to mention totally trivializing the imp damage until Kil'rek throws up a debuff. The trick is to convince the healers that it's not the end of the world if they lose 180 +heal on a few non-tank targets.
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