It can be done in hammer using the .fgd for TFC. The pick-ups like the flag or quad mode allowed you to add glows to the character that had well... picked them up. The ability to do it is quite obviously there in the engine however, I have never seen it in any other game apart from TFC. As Stojke said, the admin tool 'AMX' took use of this and made it possible in HL and CS.
Wasn't there some tool called 'Sprite' (I think) that does it? Not entirely sure what it is or what it is actually called for that matter but, it enhanced the features available in hammer for HL.