Understanding whether electronic health records, as currently adopted, improve quality and efficiency has important implications for how best to employ the estimated $20 billion in health information technology incentives authorized by the American Recovery and Reinvestment Act of 2009. We examined electronic health record adoption in U.S. hospitals and the relationship to quality and efficiency. Across a large number of metrics examined, the relationships were modest at best and generally lacked statistical or clinical significance. However, the presence of clinical decision support was associated with small quality gains. Our findings suggest that to drive substantial gains in quality and efficiency, simply adopting electronic health records is likely to be insufficient. Instead, policies are needed that encourage the use of electronic health records in ways that will lead to improvements in care.