Savlian is correct.
Just tried the spell making alter in my game with 100 restoration skill and there is no choice to make absorb health or magicka an on target spell. It's strictly on touch, but you can add AoE to it.
I always wind up making an absorb 100 health within 10ft on touch ("Devouring Sphere") on my characters when they reach 100 in restoration (costs about 139 spell points). Funny thing is, I rarely use it since I'm sneaking around a lot and the Heal Legendary Wounds spell works well enough for me. Pure mage characters can probably make more potent versions of "Devouring Sphere" with greater AoE distances.
Edit: I have tried my spell though. I got bored and went on a rampage in the IC. I tried to see how many guards I could take down without dying. Needless to say being swarmed by half a dozen meleeing guards and near dead, my Devouring Sphere spell worked quite nicely. Totally revamping my health bar.

Next time though, I'm thinking about adding the light AoE special effects to Devouring Sphere so it looks or lives more up to its name. Just not sure how to do it yet.