Selecting the Principal Diagnosis Lies at the Heart of Inpatient Coding

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The heart of the principal diagnosis selection is pivotal to accuracy and compliance.

Since February is known as “National Heart Month,” a discussion on the heart of inpatient coding is appropriate, that being the “principal diagnosis.” When learning inpatient coding, a large amount of time is spent on understanding the guidelines, conventions, and application of this term.

Within the four sections of the Official Guidelines for Coding and Reporting, we find the following:

  • Section I: Conventions, General Guidelines, and Chapter-Specific Guidelines;
  • Section II: Selection of the Principal Diagnosis;
  • Section III: Reporting Additional Diagnoses (often referred to as the guideline for the inpatient selection of “secondary diagnoses;” and
  • Section IV: Diagnostic Coding and Reporting Guidelines for Outpatient Services.

The guidelines for “Selection of the Principal Diagnosis” includes the following, which must be read over carefully and frequently:

A. Codes for symptoms, signs, and ill-defined conditions;

B. Two or more interrelated conditions, each potentially meeting the definition for principal diagnosis;

C. Two or more diagnoses that equally meet the definition for principal diagnosis;

D. Two or more comparative or contrasting conditions;

E. A symptom(s) followed by contrasting/comparative diagnoses (guideline was deleted effective Oct. 1, 2014);

F. Original treatment plan not carried out;

G. Complications of surgery and other medical care;

H. Uncertain Diagnosis;

I. Admission from Observation Unit, to include:

1. Admission Following Medical Observation;

2. Admission Following Post-Operative Observation;

J. Admission from Outpatient Surgery; and

K. Admissions/Encounters for Rehabilitation.

A first step toward understanding and selecting the principal diagnosis is the initial guideline at the beginning of Section II, which states that “the circumstances of inpatient admission always govern the selection of principal diagnosis.” Reading over very closely the documentation revolving around the circumstances of admission is required and necessary, i.e., the reason for coming to the hospital, chief complaint, emergency room documentation (including history and physical and/or a consultation), initial signs and symptoms, initial assessment and treatment plan, initial test ordered/results, and physician orders. Then we also apply the Uniform Hospital Discharge Data Set (UHDDS) definition of a principal diagnosis: “that condition established after study to be chiefly responsible for occasioning the admission of the patient to the hospital for care.”

The UHDDS definition does NOT apply to outpatient encounters. When reviewing an inpatient encounter (record), review closely the treatment and plans to ascertain if the condition chiefly responsible for the admission was identified in the documentation. Sometimes the documentation will be problematic and not specific, so a query will be needed.

Remember when querying to always follow the AHIMA/ACDIS Practice Brief from 2019.

The above two guideline components really are what is driving the selection of the principal diagnosis, and although clearly written, they can at times be difficult to apply. Keep in mind that every patient and every encounter is different.

Following the application of the “circumstances” and the “condition found after study,” we then need to determine if there is other principal guidance to be followed. Certainly, the coding conventions in the ICD-10-CM, the Tabular List, and Alphabetic Index take precedence over these official coding guidelines. (See Section I.A., Conventions for the ICD-10-CM).

I really “love” the guideline statement that “the importance of consistent, complete documentation in the medical record cannot be overemphasized. Without such documentation the application of all coding guidelines is a difficult, if not impossible, task.” This carries a strong impact on documentation and coding practices, and certainly can be used to enhance awareness and education on this topic to providers.

Audit findings and my prior experience with selection of the principal diagnosis indicate that for inpatient coding, the principal diagnosis is the single most changed code in compliance and internal and third-party audits, and this particular code really defines the entire subsequent coding structure for the encounter. Because the inpatient principal diagnosis is a major data element for the Diagnostic Related Group (DRG), the reimbursement impact can be significant if the selection of the principal diagnosis is wrong. 

The heart of the principal diagnosis selection is pivotal to accuracy and compliance.

Visit the CMS website and obtain the Official Guidelines: ICD – ICD-10-CM – International Classification of Diseases, Tenth Revision, Clinical Modification (

Editors Note: ICD10monitor will be offering a webcast on the subject of selecting the principal diagnosis, and it will include a deeper look at the guidelines, along with some case studies to review and discuss – be sure to sign up!


Gloryanne Bryant, RHIA, CDIP, CCS, CCDS

Gloryanne is an HIM coding professional and leader with more than 40 years of experience. She has an RHIA, CDIP, CCS, and a CCDS. For the past six years she has been a regular speaker and contributing author for ICD10monitor and Talk Ten Tuesdays. She has conducted numerous educational programs on ICD-10-CM/PCS and CPT coding and continues to do so. Ms. Bryant continues to advocate for compliant clinical documentation and data quality. She is passionate about helping healthcare have accurate and reliable coded data.

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