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The operator of a health-insurance collective for members of the Buffalo region’s arts and cultural community has agreed to pay $30,000 to settle accusations that he misused some of the fees he took in and allowed the members’ coverage to lapse, the state Attorney General’s Office announced this week.

Gerald Burgin, a well-known member of the arts and restaurant scene in Buffalo, created the Arts and Culturals Collaborative to give artists, actors and others a chance to obtain affordable health insurance.

Burgin collected premiums, and an administrative fee, from the members and passed the premium payments onto the collaborative’s health insurer.

However, the Attorney General’s Office said Burgin didn’t make the required premium payments in November, December and January, and the insurer cut off coverage on Dec. 1.

Burgin and the collaborative did not notify members that coverage had lapsed, and some ended up with medical expenses that they will have to pay themselves.

The Attorney General’s Office reported that an investigation found Burgin used the administrative fees for his own needs and ate into members’ premium payments after spending more than he collected for the administrative fees. This left him unable to make the premium payments to the insurer.

Under the terms of the settlement, Burgin will pay $30,000 that partly will cover members’ unreimbursed medical expenses and partly will reimburse them for premium payments that weren’t used for that purpose.

Burgin also agreed to never accept from consumers advanced payments for a product or service.

The case was handled by Assistant Attorney General James Morrissey and Karen Davis, senior consumer fraud representative, in the Attorney General’s Buffalo regional office.

Burgin has served as part-time business manager for the Arts Council in Buffalo and Erie County, as chair of Curtain Up! and as a member of the board of directors of the Theatre District Association.

email: swatson@buffnews.com