Flirting is fun, maybe she needs more fun in her life. What you want to do, (if you love your husband) is see to it that he is not the one providing this friend with too much fun...
Don't think for one minute that your husband is not flattered that this person is flirting with him, because he is. Sometimes it just feels good to be noticed by someone from the opposite sex. We all need more love and affection than we actually get, so just be aware of the situation and don't "fall asleep at the wheel..." so to speak.