We do a lot of off-hand freestyle drilling but I tend to punch so that the student gets hit if he/she doesn't take an angle. In this drill it seems like the student allows himself to be tagged and then deals with the offending hand after the fact.
HOWEVER...
I intend to watch this when I get home from work with the volume on.
Sifu Cheung is one of the few sifus on youtube that I will listen to very carefully. I believe he has an alarming prowess of the internal elements of the art. Although I've met him, I haven't rolled with him but I have rolled with some instructors who have learned under him. They were impressive.
It's a cool video and looks like some good training. I've not heard this term used this way before, but I've done things like this and it may be time to go back and revisit them.