Thats more of a mechanic question. Damage goes on a character, but maximum health is reduction in the total. Picture a green bar behind a red bar. The red bar is damage, the green one is maximum health. When the Hunter flips, the green bar goes down. If, at any time, the green bar meets the red bar, the character dies. The red bar can NEVER be higher than the green bar, only equal.
So, based on that, the hunter flips, her maximum goes down by 20, so now shes 30 maximum health with 30 Damage, then her effect sees that and goes "I dont think so.." then sets her to max 30, health 10, since it sets her to 10.