In a smart health system, patients’ location information is periodically sent to hospitals and this information helps hospitals to provide improved health care services. The location information together with time stamp alone can reveal a patient’s private information such as person’s life style, places frequently visited by the person and personal interests. Thus, it is important to protect the location privacy of a patient. In the existing privacy protection mechanisms, trusted third party (TTP) and location perturbation techniques are used. However, in TTP based mechanism, an adversary who illegally gets access to TTP server will have access to the private location information. On the other hand in location perturbation technique, utility of the location information is significantly compromised. In this paper, we propose a location privacy protection mechanism in which location privacy is protected while maintaining the utility of the location data. In the proposed mechanism, a main processing unit (MPU) attached to a patient’s body generates the perturbed location by considering the distance between the patient’s location and the pre-identified patient’s sensitive locations. This adaptive generation of perturbed location, removes the necessity to trust other parties while preserving the privacy and utility of the location data. The validity of the proposed mechanism is demonstrated by simulation results.