Yes that's the intended behavior of HLS - the content provider advertises which streams are available and at what bitrates, and the client picks which to use based on the current stream performance and its own capability.

The server can control the stream by advertising a customized manifest to individual clients, although it's a bit silly. HLS is designed to be extremely easy to load distribute and throw CDN/cache proxies in front, and it's a bad sad that content providers are this bad at load management. :/

Either way, the assumption here is that you would swap out the client doing HLS with a client designed to use a P2P protocol, including the seeding portion and network health management.