Power Heal will become available when you reach 10,000 Health. At 10,000 health, you can heal 125% above your maximum by clicking the Power Heal link beside the regular heal link. This is depicted in Battles and Bosses by a lime green bar with a red plus and the word "Buffed", which is overlayed on top of your regular health bar. As you attack (or are being attacked) and take damage, this bar will decrease first, followed by your normal health.
The Power Heal caps out at 150,000 max Health, allowing you to heal up to 500% above (or 750,000 buffed Health). Even if you are above 150,000 Health, you can still only Power Heal up to 750,000 buffed Health. The cost to Power Heal is 25% per unit of health more than regular healing, but the benefit is you won't need to heal as often.
There are two scenarios that cancel or prevent Power Healing and they are: when you are placed or are riding the Bounty and when you trigger a Counter Attack. If you trigger a Counter Attack, your buffed Health is removed and the damage is applied to you base Health. If you are placed on the Bounty, your buffed Health is removed.
You are limited to 1000 Power Heals within 24 hours of the first Power Heal. You can check and see how many Power Heals you have remaining and when you can start Power Healing again if you've used up all 1000 on your Profile page.