April 2026 ICD-10-CM Updates Include Significant Instructional and Sequencing Changes

Effective April 1, 2026, the Centers for Medicare & Medicaid Services (CMS) and the National Center for Health Statistics (NCHS) implemented International Classification of Diseases, Tenth Revision, Clinical Modification (ICD10-CM), updates that appear deceptively simple on the surface. Although the updates introduce no new diagnosis codes, deletions, or revisions, they include major instructional and sequencing changes that affect how coders report conditions.

Summary of Changes Category Impact

Rather, this is a structural update that changes how to code, not what to code, that involves:

• Converting Excludes1 notes to Excludes2
• Changing sequencing instructions from “Code first” or "Use additional code" to "Code also"
• Increasing coder judgment in principal diagnosis sequencing

Although the code set itself did not expand, these changes represent a significant structural shift in coding logic that can affect DRG assignment, compliance, and revenue integrity.

High-Impact ICD-10-CM Instructional Note Conversions

1. Excludes1 → Excludes2 Conversions

   Across multiple ICD-10-CM chapters, conditions that were previously prohibited from being coded together may now be reported together when clinically appropriate. Understanding the difference is critical:

   • Excludes1: A pure exclusion note meaning “NOT CODED HERE.” The excluded condition cannot be reported with the code above the note.
   • Excludes2: Indicates the condition is “not included here.” Both conditions may be reported together if the patient has both.

   When an Excludes2 note appears under a code, it is acceptable to assign both the code and the excluded code together when clinically appropriate. Several high-impact conversions appear across multiple diagnostic categories.

   1. Neoplasms (D18, D49)

      Excludes1 notes revised to Excludes2

      Operational impact: Dual coding may now be appropriate when the conditions are distinct and meet reporting criteria. This change increases coder responsibility to determine when both conditions should be captured.

   2. Blood and Immune Disorders (D51, D65, D72)

      Excludes1 revised to Excludes2

      Diagnoses impacted include:

      • Vitamin B12 deficiency anemia
      • Disseminated intravascular coagulation (DIC)
      • Neutropenia and decreased white blood cell count

      Clinical example: A patient with a right tubal pregnancy without intrauterine pregnancy and DIC may now have both conditions reported when documentation supports both diagnoses.

   3. Respiratory Conditions (J95.82 Postprocedural Respiratory Failure)

      Excludes1 revised to Excludes2

      Clinical example: A patient with chronic respiratory failure presents on admission who develops acute postprocedural respiratory failure following an emergent appendectomy may now have both conditions coded.

      DRG implication: This change may affect CC/MCC capture depending on sequencing and present-on-admission (POA) status.

   4. Long-Term Opiate Use (Z79.891)

      Methadone use NOS moved from Excludes1 to Excludes2.

      Coding impact: This revision may affect how long-term opiate use and substance use disorder combinations are reported.

2. Sequencing Shifts: The Most Important ICD-10-CM Update

   The most operationally significant change involves sequencing flexibility, where instructional notes now shift coding decisions to the coder’s clinical judgment.

   1. Neovascular Secondary Angle Closure Glaucoma (H40.84)

      The instructional note changed from “Code first” to “Code also.” According to the Official Coding Guidelines, a “code also” note does not provide sequencing direction. Sequencing depends on the circumstances of the encounter. This change creates a DRG decision point.

      Why This Matters: This requires stronger clinical interpretation and documentation alignment.

      Previously: Diabetes manifestations or related conditions were often sequenced according to explicit instruction.

      Now: Medical coders must determine the principal diagnosis based on:

      • Reason for admission
      • Resource consumption
      • Clinical focus of treatment

   2. Hypertensive Emergency (I16.1)

      The instructional note changed from “Use additional code” to “Code also.” This revision affects sequencing of associated organ dysfunction conditions, including:

      • Acute kidney injury
      • Myocardial infarction
      • Heart failure
      • Encephalopathy
      • Cerebral infarction

      Revenue Integrity Alert: Hypertensive emergency is no longer automatically sequenced as the principal diagnosis. Medical coders must now evaluate whether the associated organ dysfunction should be reported as the principal condition.

Key ICD-10-CM Update Takeaways for Coding Leadership

"There are no new codes. How we code will change." The April 2026 ICD-10-CM update introduces structural changes that:

• Expand allowable dual coding
• Shift sequencing responsibility to coders
• Alter DRG logic in hypertensive emergency and ophthalmology cases
• Increase reliance on clinical judgment by medical coders

Healthcare organizations that underestimate instructional note revisions may experience downstream impacts on compliance, reimbursement, and audit performance.

30-Day Readiness Checklist for Coding Teams

Healthcare organizations managing coding teams should prioritize preparation for these structural coding updates.

Immediate Actions

• Update internal instructional note reference guides
• Review Excludes1 → Excludes2 conversion scenarios
• Validate encoder and coding software updates

Within 30 Days

• Audit hypertensive emergency cases
• Audit secondary glaucoma sequencing
• Review documentation to ensure proper clinical support for dual coding scenarios

Final Perspective: The April 2026 ICD-10-CM Update Is a Logic Shift

The April 1, 2026, ICD-10-CM update is not a code expansion cycle. It is a coding logic shift cycle. Healthcare organizations that overlook instructional note revisions risk:

• Incorrect principal diagnosis assignment
• Increased denial exposure
• HCC misalignment
• Inconsistent sequencing practices
• Compliance vulnerability

Healthcare organizations that educate coders, update internal guidance, and perform early audits will be better positioned to protect both revenue integrity and regulatory compliance.

Learn more about how advanced medical coding strategies, auditing practices, and coder education programs can help your organization adapt to evolving ICD-10-CM updates while maintaining coding accuracy and compliance, and watch for our next article in this series that discusses the International Classification of Diseases, Tenth Revision, Procedure Coding System (ICD10-PCS) code updates.