A legislative decision giving the University of Utah Hospital and its doctors limited governmental immunity will enable the institution to fulfill its research mission without fear of lawsuits, hospital officials say.

Lawmakers decided that the state-owned hospital, like other government entities, should be immune from liability suits of more than $250,000 when it provides high-risk care or medical procedures not available at other hospitals.Senate Bill 142 deems the hospital services "governmental functions," which are "unique or essential to the core of governmental activity in the state."

Hospital officials who lobbied hard for the bill say they have long operated under the assumption that they were rendering a government function by providing a clinical base for research.

They are hopeful that the financially-ailing hospital will subsequently see a decrease in liability insurance premiums.

"From the hospital's point of view it's very important," said spokesman John Dwan. "With limited liability we should be able to cut back on our insurance costs."

The legislation provides for partial immunity when the hospital cares for patients referred by another hospital or physician due to the high-risk nature of the patient's condition or when it treats patients who cannot receive comparable care at other facilities in the state.

U. physicians who provide high-risk patient care or who use research procedures "in the scope of their employment" are also covered by the immunity.

The immunity bill, sponsored by Sen. Haven J. Barlow, R-Layton, initially proposed limited immunity from suits involving injury or damage stemming from virtually all patient care.

However, lawmakers believed that was too broad, said Dale Gunnell, the hospital's chief financial officer. In order for the hospital to fulfill its research mission it has to admit and treat high-risk patients, he said.

"For years we operated under the assumption that as a state entity we were entitled to the same statutes provided to other entities," he said.

But in 1989, the state Supreme Court ruled that the cap did not apply to the hospital, saying it did not render a government function.

"Well, the Legislature has come back and said we do render a government function," Gunnell said.

Patients who file claims exceeding the $250,000 cap still have the opportunity to submit excess amounts to the Board of Examiners, he added.

Passage of the legislation comes at time when the hospital is struggling financially. Since last July expenditures have exceeded revenues by $2.3 million. A task force has been established to look at ways the hospital can boost revenue by $1.5 million by July, the beginning of the 1991-92 fiscal year.