Diabetes mellitus is associated with multi-organ system dysfunction. One of the key causative factors is the increased blood sugar level that leads to an increase in free radical activity and organ damage including the cardiovascular and nervous system. Heart rhythm is extrinsically modulated by the autonomic nervous system and cardiac autonomic neuropathy or dysautonomia has been shown to lead to sudden cardiac death in people with diabetes due to the decrease in heart rate variability (HRV). Current algorithms for determining HRV describe only beat-to-beat variation and therefore do not consider the ability of a heart beat to influence a train of succeeding beats. Therefore mortality risk analysis based on HRV has often not been able to discern the presence of an increased risk. This study used a novel innovation of the tone-entropy algorithm by incorporating increased lag intervals and found that both the sympatho-vagal balance and total activity changed at larger lag intervals. Tone-Entropy was found to be better risk identifier of cardiac mortality in people with diabetes at lags higher than one and best at lag seven.