The "Rural Hospital Investment Act of 2025" establishes the Rural Hospital Investment Program in Alabama to support the financial stability of rural general acute care, critical access, and rural emergency hospitals. This program will be managed by the newly formed Rural Hospital Investment Program Board, which will oversee the distribution of state tax credits in exchange for donations to eligible rural hospitals. Key definitions such as "eligible rural hospital," "qualified donation," and "qualified donor" are introduced, along with requirements for hospitals to qualify, including service provision to Medicare and Medicaid participants and submission of a five-year financial viability plan. The board will consist of appointed members from the state government and the Alabama Hospital Association, and it will create an operations manual to assess hospitals based on financial need.

The bill also introduces new regulations regarding tax credits for donations to eligible rural hospitals, requiring third parties involved in donation management to provide a list of eligible hospitals to potential donors. Starting in March 2027, hospitals must file annual reports detailing donations received, including donor identities and intended fund usage, and report all donations to the department within 30 days. Tax credits for qualified donations can be claimed by taxpayers beginning January 1, 2026, with a total annual cap of $20 million for 2026, increasing to $30 million in subsequent years. The act ensures that these tax credits do not diminish funding for the Alabama Special Mental Health Fund and is set to take effect immediately upon passage.