Ground source heat recovery option?

We had a FHP ground system installed in our new home. It has the heat recovery system for heating water during AC mode. An electric water heater is used in conjunction. It produces warm water, but not quite hot. My question is, if I have the water heater thermostat set to a higher temperature will it work in reverse and actually lose water temperature?
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if I have the water heater thermostat set to a higher

No you won't lose water temperature, set your upper limit on the water heater to 130 degrees and the lower one to 110. I believe that is the recommended manufacturer settings for ground source heat pumps.
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