This episode begins with Klaus and Sunny crawling through a ventilation shaft in Heimlich Hospital, where they see Olaf and Esme wheeling Violet away strapped to a gurney.
Klaus, not knowing how to reach Violet without being recognized by Olaf and his henchmen, gathers some balloons and hides among the V.F.D. (Volunteers Fighting Disease). Together they plan to go room to room and sing to the patients. Klaus on the other hand, has a different idea. He is going to use the group to search rooms for Violet.
Meanwhile, Violet is trapped by Count Olaf in the same room as hospital administrator Babs. Violet has a chance to sneak a scalpel and hide it from Olaf which allows her and Babs to escape. Unfortunately, Olaf sees them and Violet is once again strapped to a bed surrounded by Olaf and his troop.
Klaus, now disguised as Dr. Faustus, tries to convince Olaf to let him see the patient list. When Olaf refuses, Sunny steals the list from him. They find the room Violet is supposed to be in, but she has been moved for surgery. Esme finds Klaus (still disguised as Dr. Faustus) in the room and brings him to the O.R. where Violet is under sleeping gas.
Count Olaf tries to force Klaus to perform an operation on Violet, where he will remove her head. Klaus tries to stall while he disconnects the sleeping gas from Violet and tells everyone in the operating room he can not perform the surgery because no one has done the paper work. He is then forced to give the Snicket file to Olaf.
Violet wakes up and it’s revealed to everyone that Klaus was not Dr. Faustus all along. Just then, Hal barges in and accuses the children of vandalism. While the ruckus in the operating room distracts everyone, Olaf sneaks out to watch the Snicket file. After hearing there may have been a survivor of the Baudelaire fire, Olaf gets so angry he sets the hospital on fire and blames the Baudelaire’s.
Klaus manages to rescue Violet and Sunny and they use a surgical tube to jump out the hospital window and land safely on the ground below. The children realize their only hope of escaping the police will be to get in the trunk of Count Olaf’s car. The episode ends with an unknown woman grabbing the hidden sugar bowl from inside the hospital.
What lies next in the lives of the Baudelaire children? Where will they end up and what will they do when they get there? Stay tuned!