ICD-10-CM Code Sequencing Basics
How to sequence ICD-10-CM codes - principal diagnosis for inpatient stays, first-listed diagnosis for outpatient visits, etiology/manifestation pairs, Code first, Use additional code and Code also notes.
On this page
Short answer
Sequencing decides which diagnosis is reported first. For inpatient admissions it is the principal diagnosis, the condition established after study to be chiefly responsible for the admission. For outpatient encounters it is the first-listed diagnosis, the condition chiefly responsible for the services provided. Tabular notes such as Code first and Use additional code can override the order for specific code pairs.
Key takeaways
- Inpatient sequencing follows Section II of the Official Guidelines (principal diagnosis); outpatient sequencing follows Section IV (first-listed diagnosis).
- Manifestation codes, usually titled "in diseases classified elsewhere", are never reported first: the underlying condition comes first.
- Uncertain diagnoses (probable, suspected, likely) are coded as if they exist for inpatient admissions, but not for outpatient encounters.
- A Code also note means two codes may be needed, but does not set the order; the circumstances of the encounter do.
Getting every code right still leaves one question: which one goes first? The ICD-10-CM Official Guidelines for Coding and Reporting answer it differently for inpatient and outpatient settings, and the Tabular List adds instructions for specific code pairs. This guide covers the basics in the order you apply them.
Step 1: Identify the setting
Sequencing rules depend on where the care happened:
- Inpatient admissions (short-term acute care, long-term care and psychiatric hospitals) follow Section II of the guidelines, "Selection of Principal Diagnosis", and Section III for additional diagnoses.
- Outpatient services (hospital outpatient and physician office encounters) follow Section IV, "Diagnostic Coding and Reporting Guidelines for Outpatient Services".
The Section I conventions and chapter-specific guidelines apply in both settings, and they take precedence where they give a specific sequencing instruction.
Step 2: Pick the principal or first-listed diagnosis
Inpatient. The principal diagnosis is defined as "that condition established after study to be chiefly responsible for occasioning the admission of the patient to the hospital for care". "After study" matters: the principal diagnosis is what the workup showed, not necessarily the admitting impression.
Outpatient. The first-listed diagnosis is the diagnosis, condition, problem or other reason for the encounter shown in the medical record to be chiefly responsible for the services provided. List additional codes for coexisting conditions that affect patient care.
Two related rules:
- Codes for symptoms, signs and ill-defined conditions are not used as the principal diagnosis when a related definitive diagnosis has been established.
- When two or more conditions equally meet the definition of principal diagnosis, either may be sequenced first unless the circumstances of the admission, the therapy provided or the Tabular List and Index indicate otherwise.
Step 3: Apply the rule for uncertain diagnoses
This is the biggest difference between settings:
- Inpatient: if the diagnosis documented at the time of discharge is qualified as "probable", "suspected", "likely", "questionable", "possible", "still to be ruled out", "compatible with", "consistent with" or similar terms, code the condition as if it existed or was established.
- Outpatient: do not code these diagnoses as if they existed. Code to the highest degree of certainty for that encounter, such as symptoms, signs, abnormal test results or another reason for the visit.
Step 4: Follow etiology/manifestation and "Code first" notes
Some conditions have both an underlying cause (etiology) and a manifestation in a particular body system. ICD-10-CM requires the underlying condition to be sequenced first, followed by the manifestation (Section I.A.13).
- At the etiology code you will find a "Use additional code" note telling you to add the manifestation code.
- At the manifestation code you will find a "Code first" note pointing back to the underlying condition.
- Manifestation codes usually have "in diseases classified elsewhere" in their title, and they are never permitted as a first-listed or principal diagnosis.
"Code first" and "Use additional code" notes are also used for other pairs that are not strictly etiology/manifestation. In each case they indicate the proper sequencing order.
Step 5: Handle "Code also" notes and combination codes
- A "Code also" note alerts you that two codes may be needed to fully describe a condition, but it does not tell you the order. Sequencing depends on the circumstances of the encounter.
- A combination code is a single code that classifies two diagnoses, a diagnosis with an associated secondary process, or a diagnosis with an associated complication. When a combination code fully describes the condition, use it instead of multiple codes (Section I.B.9). Add a secondary code only if the combination code lacks the necessary specificity.
Step 6: Check the order before you report
Read the notes for every code in the final list, including notes inherited from parent codes. In ICD Code Finder's Code Set Builder, the checks show Code first / Use additional code guidance for codes in the set alongside Excludes1 conflicts, so you can review the order before exporting.
Frequently asked questions
What is the difference between principal and first-listed diagnosis?
Principal diagnosis is the inpatient term, defined as the condition established after study to be chiefly responsible for occasioning the admission. First-listed diagnosis is the outpatient term for the condition chiefly responsible for the services provided during the encounter.
Can a manifestation code be the first-listed diagnosis?
No. Manifestation codes cannot be reported as first-listed or principal diagnoses. The etiology (underlying condition) is sequenced first, followed by the manifestation.
How are probable or suspected diagnoses coded in an outpatient visit?
They are not coded as confirmed. For outpatient encounters, code the condition to the highest degree of certainty known at the visit, such as the symptoms, signs or abnormal findings.
What if two diagnoses equally meet the definition of principal diagnosis?
When two or more interrelated or comparative conditions each potentially meet the definition, either may be sequenced first unless the circumstances of admission, the therapy provided, the Tabular List or the Alphabetic Index indicate otherwise.
Informational, not coding advice. This page summarizes ICD-10-CM conventions for education. Always code from the medical record using the current ICD-10-CM Tabular List, Alphabetic Index and Official Guidelines for Coding and Reporting, plus payer policy.
Look up ICD-10-CM codes free.
Search the current code set with instructional notes, Excludes1/Excludes2, 7th characters and GEMs, then build and check code sets.