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Unprecedented national and state initiatives are underway to promote adoption and meaningful use of electronic health records (EHRs) with health information exchange (HIE). New York State leads the nation in state initiatives and is conducting ongoing surveillance of its investments. Lessons learned from studying states like New York can inform federal policies and will be essential to evaluate the effectiveness of these initiatives. We undertook this first in a series of planned surveys to assess EHR adoption and HIE activities by New York State hospitals.Between May and December 2009, we surveyed all New York State hospitals to determine rates of EHR adoption, participation in HIE and implementation of functionalities associated with nine core meaningful use criteria.We received responses from 148 (72.2%) of 205 hospitals surveyed and found that 23 (15.5%) had adopted an EHR and 29 (23.2%) were participating in HIE. Two hospitals (1.4%) reported full implementation of the meaningful use functionalities surveyed. Public hospitals were ahead of private hospitals and notable regional differences were found.EHR adoption rates and participation in HIE are higher among New York hospitals than hospitals nationwide, suggesting that state initiatives funding community EHR implementation may influence these efforts by hospitals. However, overall rates of adoption and preparedness to meet meaningful use remain low. Direct support for hospitals, such as that provided through the national EHR Incentive Program, will likely be critical for rates of EHR adoption and HIE to significantly rise, even in advanced states.