This is from the change notes for the next upcoming Mastodon release.
Not that it matters for hugboxes (or here), but it sounds to me like if a mod blocks someone you follow, then you’ll be notified. And it sounds like there will be a list that you can access to view all “severed relationships”. Kind of neat. Transparency is good. Will prevent/mitigate sneaky mod bulshittery (and probably start drama threads on the borderline hugboxes, hehe).