Oh yea that flesh looks suuuper receded. That is definitely lacking color it should (unless it's some white variation?), not sure if "bleached' is accurate in LPS (still learning on the LPS side of things) but the flesh underneath should be down at least a solid 1"-2" from where it is given the length of those branches and size of the head, from my experience anyway.
That being said, given the polyp extension and it looks inflated, it may survive, however in no way would I consider that "healthy" for a hammer. I would at least call them and say you disagree with the corals health. Maybe tell them you'll give it a shot but if this doesn't make it, you'd expect at the very least credit.
I would advise to keep the coral low in the tank and keep lights low too to start. It could be from complete lack of lighting, or too much. Keeping it low to start though, since it kind of looks like it's been starved for light, would help it not get "shocked" by light.
I'm not an expert but I've been around the hobby 15+ yrs, only recently getting back in after a few years off and still learning on my LPS. Hope this helps!