In the story, the bust of Hippocrates serves two different functions. The first pertains generally to the doctor's profession. The second relates to the story's fantasy or Gothic genre.
Hippocrates (ca. 460 - 375 B.C.E.) was a Greek physician who wrote and/or compiled writings on medicine. Often called the "father of modern medicine," he is still well known today for the Hippocratic Oath (although probably not really its author) in which doctors pledge to do no harm.
A bust of Hippocrates would have been an entirely typical accessory for a 19th-century physician to have in his study. Hawthorne uses it ironically because Dr. Heidegger is ignoring his duty to do no harm through his reckless behavior.
In addition, the fantastic element is emphasized through this bust. When the maid moves the magic books, they affect several items. The bust smiles into the mirror—very out of keeping with the gravity associated with the person and the oath.
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