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At a hospital tucked away off one of Lisbon's main cobblestone squares, Manuela Cutileira does triage on incoming patients.

"First we do a checkup, create a chart and assign a bed number — like you would in an ordinary hospital," Cutileira, the hospital's owner, explains. "Then we try to figure out what the treatment should be. If it's a simple procedure, we'll inform the family right away of the cost. And if it's something more complicated, they may have to leave the patient here overnight for more tests."

But this is no regular hospital.

Since the early 19th century, the Hospital de Bonecas has been performing surgery on children's beloved companions — their dolls. It's the oldest known facility of its kind, where seamstresses and handymen fix broken limbs and sew torn clothes on children's dolls. The current owner, Cutileira, used to be a teacher and took over the hospital from her parents when she retired.

As a frugal alternative to Toys R Us, the Hospital de Bonecas does a swift trade at Christmas. Hospital bills start at around $5, and range into the hundreds for intricate repairs on antique collectors' items.

For lower-end repairs, Cutileira's business is booming. With 1 in 6 Portuguese out of work and poverty rising, many gifts this year are recycled — something old made new.

Grandparents bring in their own tattered childhood dolls to be restored and passed down to their grandkids. Churches also commission repairs for religious icons and figurines.

Repairing Baby Jesuses

"At this time [of year], we get a lot more baby Jesuses, because everybody's getting their nativity scene ready," says Elizabeth Pena, a Cutileira family friend who gives tours of the hospital's doll collection. "Sometimes he's had an accident the year before, so he comes in to be helped out," she says, laughing.

In the hospital's main operating room, a technician in an orderly's smock performs a double leg transplant. On a shelf nearby, a stuffed dog in a yellow raincoat belts out the tune "Singing in the Rain."

He'd lost his voice and had his vocal cords operated on, Cutileira says with a smirk. She points out that not every place like this can repair stuffed animals, dolls that cry or toys that speak.

"We accept all types of dolls. We can fix anything, from the oldest porcelain dolls to the newest Barbies and Kens," says Cutileira, who took NPR on a recent tour of her hospital. "That's what makes our hospital unique."

"We have a tendency to value, in a time of crisis, what we had when we were happy. These dolls are cherished pieces of family history," she says. "They have all the meaning in the world."

Founded in 1830, the hospital is housed in an 18th-century Pombaline row house on Lisbon's historic Praça da Figueira square.

Outside, the building — a former schoolhouse — is lined with colorful Portuguese ceramic tiles, or azulejos. Inside, the walls are lined with spare body parts from "organ donor" dolls — odd arms and legs, and assorted sizes and colors of big, blinking glass eyes.

Aside from all the dolls that are repaired and sent home, Cutileira and her ancestors have amassed one of the largest permanent collections in the world, with hundreds of thousands of dolls: from 19th-century German S" celluloid dolls, to collector's edition Barbies, to some of the oldest known multiracial dolls from Portugal's African colonies.

Cutileira has no idea how much all of this is worth, and she doesn't care to find out.

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