Now that October 1, 2025 has passed, the annual update to the ICD-10-CM / PCS code sets has brought substantial changes across many specialties. Not making the correct changes can lead to coding errors, claim rejections, and revenue disruption. Below is an overview of the most important changes, their implications, and strategies for a smooth transition.
What’s Changing: A Snapshot
Each fiscal year, CMS and the CDC release updates to the ICD-10 diagnosis (CM) and procedure (PCS) code sets. For Fiscal Year 2026 (effective for discharges and encounters from October 1, 2025 through September 30, 2026), the update includes:
- 487 new diagnosis codes, 38 revised codes, and 28 deleted codes
- Changes to the Official ICD-10-CM Coding Guidelines, including clarifications around HIV, multiple site conditions, and Type 2 diabetes in remission.
- Updates to ICD-10-PCS codes, which will apply to inpatient discharges and procedures as of October 1, 2025.
Key Changes & Their Implications
1. Type 2 Diabetes in Remission (E11.A)
A major addition is the new diagnosis code E11.A (“Type 2 diabetes mellitus without complications, in remission”). This allows providers to more accurately document patients whose diabetes has improved to the point of being in remission. The code is subject to an Excludes 1 instruction, meaning it cannot be used together with E11.9 (Type 2 diabetes without complications).
Implication: Clinicians must document clearly when a patient is in remission; coders and auditors should be prepared to query ambiguous cases.
2. Greater Granularity / Specificity in Diagnoses
Many existing codes are expanded or refined so that diagnoses can be more precise. Some of the expansions include:
- Non-pressure chronic ulcers (over 110 new codes) organized by anatomical site and severity.
- Symptom and sign codes in the digestive/abdominal system, with new fifth-digit requirements for abdominal and pelvic pain.
- Expanded R codes (symptoms and signs) to better differentiate tenderness, pain, and location.
- New codes for poisoning, adverse effects, and under-dosing of fluoroquinolone antibiotics.
- More specificity for eyelid inflammation and related ophthalmologic conditions.
- New Z codes capturing social determinants of health (SDoH), such as financial insecurity and insurance insufficiency.
- Revised descriptions and expansions of wound / abscess / skin lesion codes to capture additional body sites.
- More detailed coding for multiple sclerosis (MS): the legacy code G35 will become a parent code, and more specific codes will require specification of MS type.
Implication: Providers and coders must pay closer attention to documentation that supports the more precise coding (e.g. laterality, anatomic site, severity, activity status). Blanket or generic terms may no longer suffice.
3. Code Deletions and Revisions
Several existing codes are being retired or restructured, often to make room for more specific expansions or to reduce ambiguity. Some key examples:
- Codes in eyelid inflammation (e.g. H01.8) are being replaced by multiple more specific subclassifications.
- R10.2 (Pelvic and Perineal Pain) is replaced by multiple codes that distinguish.
- Some older codes for abscesses, skin infections, and other lesions are being restructured to allocate new body site distinctions.
Implication: Claims submitted with deleted or invalid codes on or after October 1 will be rejected. All workflows, order sets, and software logic must be updated to exclude obsolete codes.
4. Procedure (ICD-10-PCS) Updates
ICD-10-PCS updates are also part of this annual refresh. These will apply to inpatient procedure coding for discharges occurring on or after October 1, 2025. Check the FY 2026 ICD-10-PCS files for new, revised, or deprecated procedure codes and verify that EHR / billing systems have incorporated them.
Business Impacts & Risks
- Claim denials / rejections – Using outdated or invalid codes after October 1 will frequently result in rejected claims.
- Cash flow disruption – Delays in claims processing will impact revenue cycle performance.
- Increased audit risk – Insufficient documentation to support the new level of specificity may invite audits or denials.
- System and software updates – EHRs, billing systems, coders’ tools, decision support logic, and templates must all be updated in time.
- Staff training burden – Physicians, coders, auditors, billing staff, and compliance teams all need awareness and education on the changes.
- Payer alignment / prior authorization – Payors may adopt new internal edits or prerequisites based on the updated codes. It’s advisable to engage with key payers in advance to ensure their systems will accommodate the changes.
- Historical data and reporting – Trend analyses, benchmarking, and quality measures that rely on ICD codes may see shifts simply due to the new code definitions.
Recommended Steps
- Perform a gap analysis
- Identify which new, revised, or deleted codes are likely to affect your specialty or service lines.
- Flag high-volume codes or those with high revenue risk to ensure documentation supports the change.
- Update internal systems, templates, order sets, and code logic
- Ensure EHRs, billing/coding software, decision support, and clinical documentation improvement tools are updated.
- Train staff
- Hold education sessions for providers, coders, and billing/claims staff focusing on high-impact changes (e.g. diabetes in remission, ulcers, MS, pain location, drug adverse effects).
- Communicate with payers and partners
- Ask about any changes to prior authorization or documentation requirements associated with new codes.
- Audit first quarter claims aggressively
- Monitor for rejections or denials tied to coding issues.
- Provide feedback loops to clinicians and coders to correct common mistakes early.
- Feedback and continuous improvement
- Maintain a “hot issues” list of codes or scenarios causing confusion.
- Update internal guidance or policies accordingly.
- Encourage coders to send coding questions and track resolution.
Final Thoughts
The ICD-10 changes effective October 1, 2025 reflect evolving medical knowledge and the ongoing push toward greater specificity in documentation and coding. While the transition will require effort across clinical, coding, and billing teams, proactive planning is the key to minimizing disruption. LexiCode can help you with any of your coding needs. Please contact us if we can be of assistance.