Background: Much attention has been given to the proposition that the exchange of health information as an act, and health information exchange (HIE), as an entity, are critical components of a framework for health care change, yet little has been studied to understand the value proposition of implementing HIE with a statewide HIE. Such an organization facilitates the exchange of health information across disparate systems, thus following patients as they move across different care settings and encounters, whether or not they share an organizational affiliation. A sociotechnical systems approach and an interorganizational systems framework were used to examine implementation of a health system electronic medical record (EMR) system onto a statewide HIE, under a cooperative agreement with the Office of the National Coordinator for Health Information Technology, and its collaborating organizations. Objective: The objective of the study was to focus on the implementation of a health system onto a statewide HIE; provide insight into the technical, organizational, and governance aspects of a large private health system and the Virginia statewide HIE (organizations with the shared goal of exchanging health information); and to understand the organizational motivations and value propositions apparent during HIE implementation. Methods: We used a formative evaluation methodology to investigate the first implementation of a health system onto the statewide HIE. Qualitative methods (direct observation, 36 hours), informal information gathering, semistructured interviews (N=12), and document analysis were used to gather data between August 12, 2012 and June 24, 2013. Derived from sociotechnical concepts, a Blended Value Collaboration Enactment Framework guided the data gathering and analysis to understand organizational stakeholders' perspectives across technical, organizational, and governance dimensions. Results: Several challenges, successes, and lessons learned during the implementation of a health system to the statewide HIE were found. The most significant perceived success was accomplishing the implementation, although many interviewees also underscored the value of a project champion with decision-making power. In terMS of lessons learned, social reasons were found to be very significant motivators for early implementation, frequently outweighing economic motivations. It was clear that understanding the guides early in the project would have mitigated some of the challenges that emerged, and early communication with the electronic health record vendor so that they have a solid understanding of the undertaking was critical. An HIE implementations evaluation framework was found to be useful for assessing challenges, motivations, value propositions for participating, and success factors to consider for future implementations. Conclusions: This case study illuminates five critical success factors for implementation of a health system onto a statewide HIE. This study also reveals that organizations have varied motivations and value proposition perceptions for engaging in the exchange of health information, few of which, at the early stages, are economically driven.