Employee turnover, adding new employees and services and a building renovation led two departments to request increases from the City of Denver in their budgets next year.
Denver Health asked for $5 million, a request that came after the department planned $737,000 worth of cuts for next year. Pending the city council's approval, the budget for Denver Health will be just under $69 million.
Human Services, meanwhile, is seeking $17 million more.
The largest expansion to Denver Health's budget will go toward supporting employees and services provided to the Denver Sheriff's Department. Denver Health wants $1.7 million in additional funding to provide those services and personnel. The department also requested $844,000 to support employees working with detained patients.
Denver Health also asked for $292,000 to be added to the public health institute's clinical services, which would bring the total 2023 expansion of that program to $1.7 million.
Faraz Khan, the chief financial officer of Denver Health, said the budget request focuses on three primary areas: essential healthcare costs, expansions that align with operational and financial needs, and funding for upcoming market salary increases.
A big challenge for Denver Health has been cash on hand. Khan said the hospital had 86 days of cash on hand in August, compared to 200 days at other Colorado hospitals though none was named.
"Our days cash on hand had fairly significantly dropped. Eighty-six was the number in August and lower than average Colorado hospitals, " Khan said. "We are not alone in this. Based on industry reports, more than half of the hospitals have losses."
Cash on hand is a measurement of how long a business can operate with no revenue. It is also used by bond rating agencies. A higher rating makes it easier for the business to expand, said Ansar Hassan, Denver Health's senior finance director.
Khan blamed factors, such as inflation, supply chain disruptions and worldwide shortages, for the reported losses. In total, Denver Health reported a $60.8 million net income loss. This was driven by factors like increased demand for healthcare services combined by city spending not keeping up with that demand.
"That (cost of care) has grown exponentially in the past seven to eight years," Hassan said. "The cost of taking care of patients is increasing, labor is more expensive, the cost of things and the volume of patients has increased."
Human Services, which also outlined its budget request to the city council on Tuesday, asked $231.6 million, of which $173.1 million will go toward service delivery and administration expenses.
The total human services budget represents a $17 million increase year over year, or 7.92%. Last year's budget stood at $214.6 million.
Human Services, which employs 1,200 full-time workers, highlighted a vacancy rate of 7.7% and a total turnover rate of 15.7%. On average, it took 41.7 days to fill open positions, a metric Jay Morein, the department's executive director, said the department would like to see it be faster.
"I think that's more a reflection of the work pool that we're trying to recruit from," he said. "What I can say as it relates to vacancies, and turnover and the ability to recruit, that's a challenge our department is facing."
Morein said human services across the country are also facing similar challenges, but highlighted several strategies the department is taking to rectify that. Specifically, Morein said the department is creating a "pipeline" of Colorado Works recipients to fill their vacant positions.
Of the $173.1 million requested for services and administration, the department plans to spend $45.1 million on child welfare, $33.4 million on family and adult assistance and $20.9 million on "economic resilience."
"Economic resilience" spending will include the hiring of three new employees: One permanent post to act in a supervisory position, and two temporary technician positions that will assist with providing trash rebates to customers. The total for both positions is $240,000 in additional expenditures.
"We have been working on revitalizing the Castro building for quite some time before the pandemic struck," Chief Operating Officer Mimi Scheuermann said. "We're currently in the design phase for this building this project, which should be ending by the end of this year."
The total project cost of revitalizing the 20+ year old building located at 1200 Federal Blvd. will be $40 million and human services is requesting half of that for the 2023 budget year, , according to Scheuermann.