Hear me out. If you are tanking damage output your health capacity should be limited. Right now you can run 1-2 damage mods on almost any adv suit and only slightly reduce your total health while drastically improving your damage output, especially with higher ROF weapons. Since damage mods have a stacking penalty there is no point in equipping more than 2 or 3 since the damage output gain becomes negligible compared to the health you would gain by equipping a shield extender, but there is no down side to equipping this module that is at least twice as effective as additional health modules would be.

If you are going to have an item in this game that is going to be this much better than any other high slot modules, there should be some penalty for equipping it. I think that each tier of damage mod should reduce the overall health of your suit (after modules are calculated in) by the same percentage that it increases your damage output. That means that basic mods would reduce your overall health by 3% per module, enhanced mods would reduce your health by 5% per module, and complex mods would hit your health for 10% per module.

This would make damage mods a true glass cannon item so that people are not able to tank both health and damage output, as most of people you run across these days seem to do. Damage mods would then be less viable for frontline/spam-weapon fits and be more suited for stealth/speed based glass cannon fits.

Oh, so reading isn't your forte then? Ok, here's it simplified:

Damage mods give you far more damage output than the shield modules give you health, so you increase your survivability more by adding more damage output than you do by adding more health. To rectify this, you cut suit health proportionally to the amount of damage output you are given so that other high powered modules have around the same effectiveness as the damage mods.

Got it? Or do I gotta say it in baby language to make it make sense?