This paper examines functional IT complementarity between health information technology (HIT) applications and their performance effects on hospital-level measures of cost and quality. In conceptualizing functional IT complementarity, we emphasize whether HIT applications perform primary or support tasks in the clinical process, and whether they are applied in the same or different functional domains. Additionally, emphasizing the use context, we study if HIT impacts vary for chronic and acute health conditions. Finally, we examine both simultaneous and sequential complementarity, which is a departure from existing research that has largely studied simultaneous complementarity. Using four secondary data sources, we collected longitudinal data on HIT implementation levels, care quality and cost on 715 hospitals located in seven states in the U.S. We examined pairwise and three-way complementarity effects of HITs. Our central message is that in studies of complementarity and HIT, it is critical to pay attention to the sequence of technology implementation, the context of use and the functions for which technological applications are used. Our findings indicate that HIT applications demonstrate pairwise and three-way complementarity effects on care quality and cost; HIT applications impact quality and cost differently for acute and chronic conditions; and HIT applications provide both simultaneous and sequential complementarity, wherein combinations of HIT are synergistic both within a single time period and across time periods. We also find that three-way complementarity has significant economic effects on clinical quality and cost and experiential quality. In fact, our post hoc analyses indicate that three-way sequential complementarity effects are particularly significant, which research can miss if three-way and sequential complementarities are not examined. Based on our empirical results, we develop seven propositions to extend HIT complementarity theorizing. Future research can contextualize these propositions and test them in different empirical contexts to contribute to the IT complementarity perspective. In light of the extensive research in HIT and IT complementarity, this study contributes to the IS literature by examining phenomena not emphasized in the prior literature, reporting new, consequential results, and providing nuanced theorizing in HIT and complementarity domains.