This has been available on iOS for a long time, which I found to be really, really strange, given that you would think Android would be the platform where they'd want to put their more advanced features.
It isn't half bad, though -- the call quality, even when the call terminates in an actual phone number, exceeds that of cellular by a good margin, due to what I assume is a much better bitrate being used. And it works even if you don't have a Google Voice account. This is nice, because I can fire it up and make a phone call to a customer (I work for an MSP) without giving away my cell phone number. This is important to me because if all my customers had my cell number, I'd have to change it constantly or never have peace.
edit BTW, some pitfalls of this I have discovered. Depending on how well your cell handles handoffs between Wifi and LTE, your call may be dropped as you walk away from a Wifi hotspot. It works over 3G, but not well. The ringer for Hangouts on iOS is almost impossible to notice, so if you get an incoming GV call, good luck with that. I have had a good number of randomly dropped calls that I could not trace back to a cause. If you get an incoming REAL phone call on your real phone number, Hangouts (at least on iOS) immediately boots you out of your Hangouts call, even if the Hangouts call is on Wifi. (With Verizon, voice call kills LTE data stream, so this is to be expected, but with Wifi... not to be expected.)