Very complex topic but I'll break it down briefly.
In order to make a medical decision you have to first ascertain if the patient has capacity to make that decision. Examples of patients who do not have capacity: infants, patients with very advanced dementia, patients who are altered, etc.
If patient has capacity then find out why they are refusing treatment, i.e. Jehovah's Witness. You'd be surprised though the answers you will get and some you can explain and dismiss or fix (I need to feed my dog).
If they still refuse treatment and have capacity look for alternatives, try to involve family, etc. If still no luck then yeah they can refuse whatever they want.
Be careful though, for instance in the case mentioned above of the stabbing victim, if a bad outcome occurs, one could easily argue that the acute blood loss made the patient delirious and he did not actually have capacity at the time to make the decision.
Overall there is a lot of grey zone. Documentation and witnesses are important in these cases. A signed piece of paper will not protect you from being sued. It may help but documentation is paramount.
