Inpatient Rehabilitation Facility Coding

Inpatient Rehabilitation Facility Coding

By John Barrilleaux, MME, RHIA

Inpatient rehabilitation facilities (IRFs) have unique coding and documentation requirements that create special challenges for IRF coding professionals. The reimbursement model for IRFs involves the assignment of case mix groups (CMGs). In order to determine the optimal CMG, the coding professional has a responsibility to provide accurate ICD-10-CM diagnosis codes for the IRF-Patient Assessment Instrument (PAI) and to supply codes for the UB-04 claim form. This article will explore the Impairment Group Code (IGC), etiologic diagnosis, tier assignment, co-morbid conditions, principal diagnosis, and the UB-04 uniform billing form as they relate to IRF coding professionals.

The CMG is based on the impairment group, quality indicators of the patient, and the tier assignment. While the physician is ultimately responsible for the impairment group assignment and defining the etiologic diagnosis, the coding professional is accountable for turning the documentation into the codes for IGC and the etiologic diagnosis. Ideally, the IGC and etiologic diagnosis assignment is obvious in the documentation, but sometimes it is not. If the coding professional has difficulty determining these two items, a physician query should be used to clarify.

Finding the IGC and etiologic diagnosis is one of the most challenging aspects for IRF coding professionals. The etiologic diagnosis indicates the “etiologic problem that led to the impairment for which the patient is receiving rehabilitation.”1 The impairment group is the code that “best describes the primary reason for admission to the rehabilitation program.”2 A unique feature of the etiologic diagnosis is that it is not always found in the current state of the condition. The etiologic diagnosis code is assigned for the acute condition that is the cause or origination of the impairment being treated while in the IRF. The etiologic diagnosis may be a code for a condition no longer being treated or is in a status that is no longer applicable (i.e., acute on chronic versus chronic).

On the IRF-PAI, the etiologic diagnosis is entered on line 22. Line 22 has three spaces for ICD-10-CM codes; however, the intent of the etiologic diagnosis, for most impairment groups, is a single condition that is the problem that led to the rehab admission. More than one code would be required in some impairment groups, such as those for major multiple fractures (08.4), major multiple trauma (14.x), and open traumatic brain injury (TBI) (02.21). Closed TBI (02.22) and traumatic spinal cord injury (04.2xxx) may have two codes when there is a related skull fracture with a TBI and a vertebral fracture with a spinal cord injury.

The guidelines for selection of the etiologic diagnosis do not follow the ICD-10-CM Official Guidelines for Coding and Reporting as with other levels of care (such as acute inpatients). An ICD-10-CM code is assigned to meet the definition of the etiologic diagnosis as stated in the IRF-PAI manual. For instance, consider a person being admitted to rehabilitation for a recent fracture. The seventh character for initial encounter (generally “A”) is used for the etiologic diagnosis because this is the code that represents the etiologic problem or origination that led the patient to rehab. This is the only place (on the IRF-PAI) that coding professionals use the seventh character for initial encounter for any condition that pre-dates the admission to the IRF. On the UB-04 form, the seventh character for subsequent encounter is used. The etiologic diagnosis is the original condition that led to the rehab where the principal diagnosis is the current state or condition that meets the definition of principal diagnosis per the ICD-10-CM guidelines. The principal diagnosis should meet the definition and be related to the impairment group.

The impairment group code is entered on the IRF-PAI on line 21. The best resource for assigning the impairment group is appendix A of the CMS IRF-PAI manual. Appendix A of the IRF-PAI manual has a summary list of the impairment groups and a second section that lists ICD-10-CM codes related to the specific impairment groups. This table is a guide for the IGC selection and should not be considered a definitive list, but it is a valuable resource to assign the IGC.

Within the list of related codes in Appendix A of the IRF-PAI manual are notes to guide each IGC. The stroke category (01.x), for instance, includes notes on using codes for sequelae of cerebrovascular disease and transient ischemic attacks (TIA). The sequelae of cerebrovascular disease ( may be appropriate under certain circumstances, but a TIA is not.

Once the etiologic diagnosis and the focus of the treatment is determined, the coding professional can use Section 2 of Appendix A to search for the ICD-10-CM code or code range to find the impairment group. When the impairment group is located, the next step is to determine if this is the best fit for the impairment and the focus of the treatment. Most often, this list in Appendix A will guide the coder to the right area.

Co-morbid conditions are secondary “conditions a patient may have in addition to the primary diagnosis.”3 Co-morbid conditions have a significant impact on the patient’s course of treatment. These conditions are listed on line 24 of the IRF-PAI and do follow the ICD-10-CM guidelines for reportable diagnoses. From the list of co-morbid conditions, a tier assignment may be made. The tier assignment, which can impact the CMG, is from a list of codes provided by CMS. The tier assignment contains four categories, tiers 1-3 and no tier. Category one has the highest impact on reimbursement. The tiers are based on the ICD-10-CM codes that are entered into the IRF-PAI on line 24, Co-Morbid condition, and should be codes for conditions that the patient has in addition to what is listed as the etiologic diagnosis. Conditions already included in the impairment group are not considered co-morbid. As an example, if a patient is admitted to an IRF for rehab for a right knee replacement under the IGC 08.61 unilateral knee replacement, the knee replacement status code Z96.651 is not used as a co-morbid condition because it is already included in the impairment group.

In IRF coding, the coding professional should provide two sets of codes. The coding professional provides the IGC, etiologic diagnosis, and co-morbid conditions in one set of codes, and codes for the UB-04, which includes the principal diagnosis and co-morbid conditions, in the second set. The codes on the UB-04 form will follow the ICD-10-CM Official Guidelines for Coding and Reporting, meaning that the principal diagnosis could be an ICD-10-CM code that does not appear on the IRF-PAI.

Below is a scenario to demonstrate the assignment of IGC, etiologic diagnosis, co-morbid conditions with tier assignment, and UB-04 forms.


A left-handed patient is admitted to the IRF for a recent left occlusive middle cerebral artery infarction. The patient has residuals from the infarction, including right hemiparesis, dysarthria, and oropharyngeal dysphagia. The patient also has diabetes mellitus (DM) type 2 with polyneuropathy, hypertension, and hypothyroid disease.

IGC 01.2 CVA with R body involvement  
Etiologic Dx I63.512 Cerebral Infarction due to unspecified occlusion or stenosis of left middle cerebral artery. Principal Diagnosis I69.353 Hemiplegia following cerebral infarction affecting right non-dominant side
Co-Morbid Condition R47.1 Dysarthria and anarthria Co-Morbid conditions I69.322 Dysarthria following cerebral infarction
  R13.12 Dysphagia, oropharyngeal phase   I69.391


Dysphagia following cerebral infarction and Dysphagia, oropharyngeal phase
  I10 Essential Hypertension   I10 Essential Hypertension
  E11.42 DM 2 with polyneuropathy   E11.42 DM 2 with polyneuropathy
  E03.9 Hypothyroidism, unspecified   E03.9 Hypothyroidism, unspecified
IGC, Etiologic Dx, and Principal Dx

The condition that led to the impairment being treated in the IRF stay is the cerebral infarction, I63.512. The infarction is the etiologic diagnosis even though it is no longer a reportable condition for the IRF stay under ICD-10-CM coding guidelines. The IGC is in a stroke impairment group, which is based on paresis (left hemiparesis, 01.1; right hemiparesis, 01.2; bilateral hemiparesis 01.3; no paresis 01.4; or other paresis 01.9 such as monoplegia or other paralytic syndrome that does not fall into hemiparesis). Because the patient has right hemiparesis, the stroke impairment group for right body involvement is used.

This IGC indicates that the patient has full right hemiparesis. Since this impairment group already includes the infarction with right hemiparesis, a separate code for right hemiparesis is not used as a co-morbid condition on the IRF-PAI. Because the UB-04 claim form requires the principal diagnosis as defined by the ICD-10-CM coding guidelines, the principal diagnosis on the form is I69.353, hemiplegia following cerebral infarction affecting right non-dominant side. The hemiparesis will be the primary focus of the treatment.

Co-Morbid Conditions

Codes (from chapter 18 – Symptoms and Signs) for the remaining infarction residuals are being used on the IRF-PAI because the infarction is already included in the IGC. The infarction sequelae code is used on the UB-04 form to indicate the sequelae from the infarction as instructed by the ICD-10-CM Official Guidelines for Coding and Reporting. For the dysphagia, code R13.12 is used on both forms. The instructional notes in the ICD-10-CM codebook under I69.391 state to “use an additional code to identify the type of dysphagia, if known.”4 The codes for the hypertension, diabetes, and hypothyroidism are the same on both forms and are not impacted by the IGC assignment for this scenario.


Code R13.12 is a tier 2 diagnosis code. The CMS list of tier diagnoses states that this code is excluded from the stroke category, so this does not affect the tier assignment. The diabetes with polyneuropathy is also on the tier diagnosis list and is not excluded from the stroke category. This diagnosis code will assign tier 3 to the CMG.

In addition to the usual ICD-10-CM coding references, having the resources discussed in this article is important to be successful in IRF coding. Understanding these concepts and using these references will help to assure the accuracy of the codes assigned for the patient assessment and reimbursement.

  1. CMS (Centers for Medicare and Medicaid Services). 2019. IRF-PAI and IRF-PAI Manual.
  2. Ibid.
  3. Ibid.
  4. Ibid.

John Barrilleaux ( is an assistant professor and interim program director at Southern University at New Orleans. He is also principal consultant and president of Rehab Coding Services LLC.

Leave a comment


  1. Excellent, and a much needed, detailed explanation of adequate resources for IRF coding.

  2. Thank you for describing the complexity of IRF coding!
    It is the coder’s skill and experience which helps place the patient in the most correct IGC allowing for ample days to treat the patient and contributing a large part to setting the correct reimbursement rate. The coder must interpret what is written in the record accurately while keeping all the different rules and regulations in mind, as well as always be assessing for the various opportunities for 60% compliance (another feature of the weird IRF PPS).
    I hope some IRF administrators read your article and make sure to value the coders they have!

  3. Found this article to be very straightforward incorporating examples to better explain coding rules and concepts and including sources for clatification.

  4. This is very useful information. Thanks for the effort and the research!

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