Dealer asked for $150 to use my USB port again.

My dealer updated my audio system for free (twice) when I asked. The first time was becasue I was having some bluetooth issues with jumbled sound. The second time I just used the same reason since it had worked the first time.
So, try a different dealer!

 

I’m not aware of anything in the Toyota audio systems for fourth-generation Prius cars that requires updating merely because of the passage of time, distance driven, or anything like that.

Toyota has issued several updates to correct defects in the head unit software. In the service bulletins announcing these, Toyota writes, “This repair is covered under the Toyota Basic Warranty,” for 3 years or 36,000 miles from the car’s in-service date. If your car hasn’t exceeded either limit, and none of the other warranty exclusions (such as for salvage vehicles) applies, the dealer should install any update, if needed, at no cost to you. After the warranty coverage ends, the dealer is free to charge this service.

I don’t know, however, whether an update would resolve the problem you’ve described; the trouble might actually be in the car’s USB connector or wiring, for example. Indeed, since the updates are installed by writing the new software to a USB flash drive and connecting it to the car, if the USB connection isn’t working, it might be impossible to install an update. There is also a small chance, if the update fails, that the head unit (Radio & Display Receiver Assembly, part number 86140-47270, list price $3,650.21) might have to be replaced or removed and sent away for repair.

If you’d like to install the update yourself, a Toyota website (securedp.toyota.com) has an older version available to download at no charge. If you want the latest version, you’d need a Professional Diagnostic subscription to techinfo.toyota.com (from $65 for two days). Look for T-SB-0279-17 Rev2, “Entune Audio Head Unit Software Update (Panasonic),” issued November 13, 2018, which should have a link to download the update file, “13TBDANA-DA10_0080.kwi.”

If your car is still under warranty, I’d endorse @krmcg's kind suggestion to visit another dealer. Otherwise, you could try installing the update yourself, carefully following Toyota’s instructions. You might start with the free version, if it’s newer than the one in your car. If you’re able to install it—proving that the USB port works—but the trouble continues, it might be worth $65 to download the very latest version.

 

Yeah, I would bring up the fact that the car is still under warranty. Only thing I would think isn't covered would be map updates for navi.

 

call toyota customer service

 

You can also update it yourself. Toyota Downloads

 

I wouldn't risk bricking the unit by trying to update it if the USB port isn't working correctly, just to get iPhone music.
I would first try another iPad cable, it could just be your cable is duff if the dealer used your cable with his phone.
Next try just plugging a USB stick with songs on it in, if that works then the USB port should be ok.
The fact that it was working, then not, points to either the cable or the USB port being faulty, the latter should be fixed under warranty.

 

Already stated.
Also stated is the latest version is not there and is available by techinfo professional diagnostic subscription only.