I searched and didn't find it. Credit goes to Bug? - Mage - Arena Junkies just posting it here.
You have to target your water elemental and set the person you want to heal on focus. You then do focus frostbolt and it heals the player.
/cast [target=focus] Frostbolt
Edit: I think if the player is in your party you don't even have to target your water elemental.
Other players have found out that you can damage unflagged enemies also. Have fun.