It is an objective of the present invention to provide an optimized method of selection of the encoding mode that provides rate efficient coding of the input speech. It is a second objective of the present invention to identify and provide a means for generating a set of parameters ideally suited for this operational mode selection. Third, it is an objective of the present invention to provide identification of two separate conditions that allow low rate coding with minimal sacrifice to quality. The two conditions are the coding of unvoiced speech and the coding of temporally masked speech. It is a fourth objective of the present invention to provide a method for dynamically adjusting the average output data rate of the speech coder with minimal impact on speech quality.