Do you know if settlement visas are the only ones excluded? Or are PBS visas excluded as well? Sorry, I haven't got time to read through that link.
That part of the law is intended to catch those who aren't allowed free NHS, and that includes non resident Brits.
The new Immigration Bill that became law in May 2014,
http://talk.uk-yankee.com/index.php?topic=82892.0will affect those that don't have ILR. I doubt it will affect those already on a visa in the UK. We will find out soon enough which visas they intend to start with, but it is written so that it affects everyone without ILR.
It's reinforcing that it's the National Health Service (NHS) and not the International Health Service it has become. It is health care for British nationals and those that show a committment to the UK (those with ILR). Internationals wanting to come to the UK, will pay a levy before they are allowed to use the NHS for free.
They won't pay for every treatment, so it is still very generous, but they will pay a small NHS levy if they have a visa of over 6 months. Those with a visa under 6 months, still won't get free NHS and will now find it almost impossible to get free NHS.
We don't know how much that levy will be yet as it hasn't been set although the government has said it will be cheaper than private insurance. For that levy, they will get access to the NHS, but will be excluded from expensive discretionary treatment until they have ILR.
If their visa is denied, then they get the NHS levy back. Their national insurance number will be date stamped until their visa ends, or removed if their visa is withdrawn.