4.1 ICD-10-CM Official Guidelines and Conventions
Key Takeaways
- FY 2026 ICD-10-CM Official Guidelines (effective October 1, 2025 through September 30, 2026) state that classification conventions and instructions take precedence over the guidelines in every setting.
- NEC in the Index or Tabular means other specified; NOS means unspecified; an Excludes1 note means not coded here, with a documented exception only when the two conditions are clearly unrelated.
- Etiology/manifestation notes (code first, use additional, in diseases classified elsewhere) direct sequencing; a code also note can require two codes without telling you which is first.
- Placeholder X fills empty character positions so a required seventh character sits in the seventh position (T36–T50 is the printed example); laterality and combination-code rules live in Section I.B.
- Section IV uses first-listed diagnosis for hospital outpatient services and forbids coding probable, suspected, or rule-out language as if the condition were confirmed.
ICD-10-CM Official Guidelines and Conventions
Quick Answer: The FY 2026 ICD-10-CM Official Guidelines for Coding and Reporting (CMS file, 121 pages) are organized into Section I (conventions, general guidelines, and chapter-specific guidelines), Section II–III (inpatient principal and additional diagnoses), and Section IV (outpatient). Conventions printed in the Alphabetic Index and Tabular List take precedence over the guidelines. For the three-question AAPC Certified Outpatient Coder (COC) coding-guidelines domain, master Section I lookup mechanics first, then preview Section IV first-listed and uncertain-diagnosis rules without trying to memorize every ICD-10-CM chapter here.
This independent OpenExamPrep chapter helps learners study International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) diagnosis rules for hospital outpatient and ambulatory surgery center (ASC) work. It is not a Centers for Medicare & Medicaid Services (CMS), National Center for Health Statistics (NCHS), American Hospital Association (AHA), American Health Information Management Association (AHIMA), or American Academy of Professional Coders (AAPC) product, and it does not claim partnership or official review by those organizations.
Why Section I is a facility coder's daily tool
AAPC's Taking the COC exam page assigns 3 of 100 questions to coding guidelines and names the ICD-10-CM Official Guidelines as one of the three topics in that domain. Those three items are not a substitute for the 15-question ICD-10-CM domain or for diagnosis work hidden in Current Procedural Terminology (CPT) categories and in the 10 end-of-exam cases. They do test whether you can apply conventions that the classification itself prints: not elsewhere classifiable (NEC) versus not otherwise specified (NOS), Excludes1 versus Excludes2, code first / use additional code, laterality, combination codes, and placeholder X.
Hospital outpatient and ASC claims still need a complete, specific diagnosis code on the UB-04. If you treat the Official Guidelines as inpatient-only, you will carry Uniform Hospital Discharge Data Set (UHDDS) principal-diagnosis habits and inpatient uncertain-diagnosis habits into same-day surgery. Section I applies in all health care settings unless a later section says otherwise. Section IV then changes two outpatient behaviors: what sits in the first-listed position, and the ban on coding “probable” as if it were confirmed.
The Cooperating Parties for ICD-10-CM (CMS, NCHS, AHA, and AHIMA) publish the Official Guidelines. FY 2026 is the set in force October 1, 2025 through September 30, 2026. Recheck the CMS PDF before you sit if a newer fiscal year has started. Do not invent a rule that is not in the classification or in that PDF.
Conventions take precedence
Section I opens with a hierarchy you should be able to recite: the conventions and instructions of the classification take precedence over guidelines. If a Tabular Excludes1 note, a code first note, or an Index see instruction conflicts with a study-sheet shortcut, the book wins. Chapter-specific guidelines in Section I.C still matter for later ICD-10-CM chapters in this guide; they do not replace the conventions in Section I.A.
Alphabetic Index and Tabular List — both are required
ICD-10-CM diagnosis lookup is a two-book (or two-section) process.
- Start in the Alphabetic Index (Index to Diseases and Injuries, plus the Index to External Causes, Table of Neoplasms, and Table of Drugs and Chemicals when those tables apply).
- Verify in the Tabular List. The Index does not always give the full code. Laterality and any applicable seventh character are completed only in the Tabular List.
A dash (-) at the end of an Index entry means additional characters are required. Even when the Index has no dash, you still open the Tabular List to confirm that no seventh character is required. Codes are reported at the highest number of characters available for the documented condition. Three-character codes are category headings; many are not valid as reported codes until they are expanded.
Diagnosis codes used for reporting are those in the ICD-10-CM range the guidelines name for that purpose (including Z00–Z99 encounter codes and U00–U85 codes when those categories apply). You do not invent a local fourth character because the Index looked “close enough.”
NEC, NOS, other specified, and unspecified
| Abbreviation or class | Official sense | Facility habit |
|---|---|---|
| NEC (“not elsewhere classifiable”) | Other specified. A specific code is not available for a documented condition, so the Index or Tabular directs you to an “other specified” code. | The record is specific; the classification has no dedicated code. |
| NOS (“not otherwise specified”) | Unspecified. Equivalent of an unspecified code. | The record lacks detail that would support a more specific code. |
| Other specified codes | Residual codes when documentation names a type the Tabular does not list separately. | Do not use “other” merely because you did not look far enough in the Index. |
| Unspecified codes | Used when the record does not identify a more specific type, site, or laterality that the classification provides. | Unspecified is a documentation gap you accept, not a default you prefer. |
| Default code | The code listed next to a main term in the Index; it represents the condition most commonly associated with that term, or the unspecified code for it. | If the note says only the main term (for example, no acute versus chronic), assign the default. |
NEC and NOS are not interchangeable. A colonoscopy report that names a specific colitis type the classification does not isolate is an NEC / other-specified problem. A report that only says “colitis” with no type is an unspecified / NOS problem. Swapping them is a convention error, not a style choice.
Includes notes, inclusion terms, and punctuation
Includes notes appear immediately under some three-character titles to further define the category or give examples. Inclusion terms listed under a code are conditions assigned to that code; the list is not exhaustive. Absence from the inclusion list is not a reason to reject a code the Index and Tabular otherwise support.
Punctuation in the classification has defined jobs:
- Brackets [ ] in the Tabular enclose synonyms, alternative wording, or explanatory phrases. In the Index, brackets identify manifestation codes.
- Parentheses ( ) enclose nonessential modifiers — supplementary words that may be present or absent in the diagnostic statement without changing the code.
- A colon : in the Tabular follows an incomplete term that needs one or more of the modifiers listed after the colon before the term is assignable to that category.
- The word and in a code title is read as and/or when that is the classification’s narrative sense.
These marks are instructions, not decoration. Skipping a bracketed manifestation code in the Index is how etiology/manifestation pairs get sequenced backward.
Excludes1 versus Excludes2
The FY 2026 guidelines state that each excludes note means the excluded codes are independent of each other, but the two types are not the same instruction.
| Note | Printed meaning | Report both? |
|---|---|---|
| Excludes1 | “NOT CODED HERE!” A pure excludes note. The excluded code should never be used at the same time as the code above the note. Used when two conditions cannot occur together (the guidelines’ example pattern is a congenital form versus an acquired form of the same condition). | No — except the documented exception below. |
| Excludes2 | “Not included here.” The excluded condition is not part of the condition represented by the code, but a patient may have both. | Yes, when both are documented and appropriate. |
Excludes1 exception (do not expand it): the guidelines allow both codes when the two conditions are unrelated to each other. If it is not clear whether the two conditions involving an Excludes1 note are related, query the provider. The printed example uses F45.8 (other somatoform disorders), which has an Excludes1 for sleep-related teeth grinding (G47.63) because teeth grinding is an inclusion term under F45.8. Only one of those two codes is assigned for teeth grinding. Psychogenic dysmenorrhea is also an inclusion term under F45.8, and a patient could have that condition and sleep-related teeth grinding; those two conditions are clearly unrelated, so reporting F45.8 and G47.63 together is appropriate.
That exception is not a license to ignore Excludes1 whenever two codes would raise relative weight. If the conditions are the same clinical idea (or it is unclear), you do not report both.
Code first, use additional, in diseases classified elsewhere, and code also
Some conditions have an underlying etiology and body-system manifestations. The classification uses a paired convention:
- At the etiology code: use additional code to identify the manifestation, when applicable.
- At the manifestation code: code first the underlying condition. Manifestation titles include “in diseases classified elsewhere.” Those manifestation codes are never first-listed (and never principal in inpatient settings).
Code also is a different note. It instructs that two codes may be required to fully describe a condition, but it does not provide sequencing direction. Sequence from the reason for the encounter and any other applicable guideline, not from a habit of always listing the code with the note second.
“With” (and “in” in the same Index/Tabular role) is interpreted as associated with or due to when it appears in a code title, the Alphabetic Index, or a Tabular instructional note. The classification presumes a causal relationship between the linked conditions. Code them as related even without an explicit provider link, unless the documentation clearly states they are unrelated or another guideline requires a documented link. This is how combination diabetes and similar Index “with” entries behave; later medical-chapter sections apply it to specific categories without changing the convention.
Combination codes, laterality, placeholder X, and the seventh character
A combination code is a single code that classifies two diagnoses, or a diagnosis with an associated manifestation or complication. Assign only the combination code when it fully identifies the documented elements. Do not add a second code that repeats what the combination already includes. If the combination lacks needed specificity, then an additional code is appropriate.
Laterality (Section I.B.13): some codes specify left, right, or bilateral.
- If no bilateral code exists and the condition is bilateral, assign separate left and right codes.
- If the side is not identified, assign the unspecified side.
- A unique ICD-10-CM diagnosis code is reported only once per encounter; that includes bilateral conditions when the classification has no distinct laterality codes.
- When a bilateral condition exists and each side is treated at separate encounters, assign the bilateral code (the condition still exists on both sides), including on the encounter that treats only one side — unless no bilateral code exists, in which case assign the laterality code for the side treated. After one side is gone (for example, amputation), assign the code for the remaining side.
Placeholder X and seventh characters (Section I.A.4–5): ICD-10-CM uses X as a placeholder at certain codes to allow future expansion. The printed example is poisoning, adverse effect, and underdosing categories T36–T50. Where a placeholder exists, X is required for a valid code. Certain categories require a seventh character. That character must always occupy the seventh position. If the code is not already six characters long, insert X in the empty positions so the seventh character stays seventh. Putting a seventh-character value in the fifth or sixth slot is not a valid code. Injury seventh-character meanings (initial encounter, subsequent, sequela) are taught with the injury chapters; the placement rule belongs here.
Section IV preview — outpatient first-listed, not a second copy of that chapter
Section IV applies to hospital-based outpatient services and provider-based office visits in addition to Section I. Two outpatient facts must be in place before later Section IV study:
- First-listed diagnosis is the outpatient term used instead of principal diagnosis. UHDDS principal-diagnosis definition does not apply to hospital outpatient services. For outpatient surgery, code the reason for the surgery as first-listed, even if surgery is not performed because of a contraindication. If the postoperative diagnosis is more definitive than the preoperative diagnosis, use the postoperative diagnosis. For observation, the medical condition that occasioned observation is first-listed when that is the reason for the stay; if the patient came for outpatient surgery and then needed observation for a complication, the reason for surgery remains first-listed, followed by complication codes. Full observation and clinic sequencing is a later chapter.
- Uncertain diagnosis: do not code diagnoses documented as “probable,” “suspected,” “questionable,” “rule out,” “compatible with,” “consistent with,” “working diagnosis,” or similar uncertainty. Code to the highest degree of certainty for that visit — symptoms, signs, abnormal test results, or other reason for the visit. The guidelines explicitly contrast this with inpatient uncertain-diagnosis practice.
Facility scenario
Same-day surgery: left knee arthroscopy. Preoperative diagnosis “rule out medial meniscus tear.” Postoperative diagnosis: confirmed left medial meniscus tear. The facility coder does not first-list a rule-out code. After confirmation, the postoperative meniscus diagnosis is first-listed, with laterality completed in the Tabular List. If the case had been stopped for a contraindication before incision and the tear was never confirmed, Section IV would keep you on the reason for surgery as first-listed and would still forbid coding the unconfirmed tear as if it existed. Current Procedural Terminology reporting of a discontinued arthroscopy is a modifier problem (next sections), not an excuse to violate the uncertain-diagnosis rule.
Source to reopen in your code book
FY 2026 ICD-10-CM Official Guidelines for Coding and Reporting (CMS PDF)
Under the FY 2026 ICD-10-CM Official Guidelines, which statement correctly describes an Excludes1 note?
A poisoning code from ICD-10-CM categories T36–T50 requires a seventh character, but the code is not six characters long before that character is added. What does the FY 2026 Official Guidelines instruction require?
A hospital outpatient same-day surgery note lists a preoperative diagnosis of “rule out acute appendicitis.” Surgery is canceled for a contraindication before incision, and no confirmatory postoperative diagnosis is documented. Which Section IV instruction should the facility coder apply to the diagnosis?