I enjoy TargetFrameHealthText and HealthFade mods, I know they both work independently, but I wanted to put together two addons I enjoyed, so here it is.

With Mirons help I combined:
HealthFade with TargetFrameHealthText

Now TargetFrameHealthText has Hitpoints Fading included.

Haven't had any errors or problems with it, if you'd like to use one or the other, and not both, you can find them listed below with their respected authors.

Health Fade is by: Baree
and can be found here:
http://www.curse-gaming.com/en/wow/addons-738-healthfade.html

TargetFrameHealthText is by: Miron
and can be found here:
http://www.curse-gaming.com/en/wow/addons-54-targetframehealthtext.html

21-11-07 No longer updating this because the % feature is included in Blizzards' Interface Options; if you'd like the recoloring of the bar you can find it here: http://wow.curse.com/downloads/details/1727/

Problems with it being outdated?

Load Out of Date Mods

OR

Open the TOC file and REPLACE:

1. 1. Interface: 20000

with

1. 1. Interface: 20300

If someone else would like to continue to update this addon, be my guest.