Jack Duffy's friends assume his business is booming. After all, he runs Vermont's largest inpatient addiction treatment facility — Valley Vista in Bradford — at a time when the state has garnered national headlines for its commitment to fighting opiate addiction.

But after three decades, Duffy's business has never been on shakier ground. He recently laid off about 8 percent of his staff in response to a $588,000 revenue reduction, the source of which is his biggest customer — the State of Vermont.

Duffy isn't alone. Officials at Vermont's two other big residential treatment homes for drug addicts, Serenity House in Wallingford and Maple Leaf Farm in Underhill, are also struggling with state funding cuts. Serenity House is down $100,000 in a $1.8 million budget. Maple Leaf lost $200,000 on a $4.2 million budget.

What's going on? The Vermont Department of Health has in the past year effectively halved the number of days it pay for addicts to stay in the three facilities, from 20 to 30 days to roughly 15 days.

The state has a ready explanation: Experts say 15 days provides adequate care, and assistance in excess of that can be done just as effectively — and more affordably — in outpatient programs. Moreover, the state says, treatment facilities can help a larger number of addicts if they turn over beds quicker.

Previously, the health department says, it essentially wrote blank checks to the clinics for unnecessarily long stays. Now the department requires facilities to offer substantial evidence to justify extending a patient's stay beyond 15 days, just as they say private insurers have long done.

"That's commonly done in the medical world to ensure that the patients are getting the right amount of care, not too much care," said Barbara Cimaglio, deputy health commissioner for alcohol- and drug-abuse programs. "We didn't have any guidelines in place. People could stay pretty much as long as they wanted and there was nothing that looked at, 'Are we getting the right amount of care?' This is pretty common. Vermont was not doing it."

The treatment centers say they are uneasy about the cutbacks, as Vermont has lavished attention and resources on its outpatient initiative — the "hub and spoke" system — for treating opiate addicts.

For example, in November, Gov. Peter Shumlin cut the ribbon to celebrate the opening of a new outpatient methadone clinic in Rutland, described as a vital tool to combat what the governor has called an opiate "crisis."

At the ceremony, Shumlin talked about helping addicts and treating addiction as a disease.

But just eight miles away, at nonprofit Serenity House, officials were struggling to cope with the state cuts without resorting to layoffs at the 28-bed facility.

"Fifteen days, it almost seems they're leaving a few minutes after they come in. I think longer is better in most cases," said Dick Keane, president of Serenity House. "That gives you time to bond with a client and make progress."

The state implemented the change last summer.

"It hit us fast and sudden," Keane said. "None of us were able to adjust to it quickly. We're all feeling the pressure financially."

Part of the goal, Cimaglio said, was to free up more bed space, to allow more people to experience inpatient care.

Mission accomplished. All three facilities report they have registered approximately 50 percent more patients so far this year.

"Every place is trying to bring in everybody they can," said Bill Young, executive director of the nonprofit Maple Leaf Farm.

Valley Vista, for example, projects that it will see 785 patients this year, as compared to 508 last year — a 54 percent jump.

But that influx hasn't brought in enough cash to balance their books.

Why? The first and last days of a patient's stay in a treatment facility are the most labor intensive — and, therefore, the most costly. That's when staff members conduct medical and psychological evaluations and fill out the bulk of the paperwork. The days in between, which involve fewer staffers, work out to be more profitable. In short, fewer clients staying longer equates to a more lucrative business model for addiction-treatment facilities.

The 15-day limit is not a hard cap. After 12 days, the treatment center can appeal to the health department for an extension on behalf of a patient. Ninety percent of those requests get approved.

"We really have to determine what is the need clinically," Cimaglio said. "If they need 20 or 25 days, it will be approved."

But that doesn't tell the whole story, treatment providers say. Most of the extensions are only for a few days. Moreover, officials from all three facilities say that the appeal process actually often shortens the average patient's stay length. Addicts are notoriously anxious and fickle and often enter treatment programs with skepticism. Knowing they can only count on staying 15 days and will have to file an appeal — before their time is up — prompts many to abandon hope and skip out early, according to representatives from the treatment facilities.

"All of the patients have a great deal of anxiety about what's going to happen next," said Richard DiStefano of Valley Vista. "The patients short-circuit it because they can't deal with the anxiety."

The numbers appear to support DiStefano's theory. Despite the successful appeal rate, the average stay length at the facilities is around 17 days. And, despite having 54 percent more clients, Valley Vista's "patient days," the number of days each bed is filled, are down about 10 percent. The other programs report similar dips.

There are, of course, concerns beyond money — namely, that shorter stays will make it more difficult for addicts to recover. Treatment facilities say they have worked to condense their programs into the tighter time frame.

Cimaglio said that much of the important work — helping addicts find housing and jobs, and helping them foster better relationships with family and friends — takes place outside the facilities. Cimaglio said the numbers support her department's efforts.

For the first six months under the new 15-day regimen, the rates at which addicts came back for a second or third stay — presumably because they relapsed — were largely unchanged from the prior year.

"The driving factor is, 'What is the needed level of care?'" Cimaglio said. "One could not think this is going to be the primary place where most people get treatment. The great number of people has always been treated outpatient. These are folks with very unstable lives, and they have a lot of needs. Residential treatment is designed to take care of one piece of that."

But others in the drug-treatment community aren't convinced.

Chittenden County's Rapid Intervention Community Court, in which addicts are diverted from the criminal justice system, sends many of its clients to the three residential treatment centers.

Three RICC participants who spoke to Seven Days on condition of anonymity last February said they would have benefitted from stays longer than 15 days.

"That's what they say: 'Two weeks is a start; it's not enough to get anything accomplished,'" said RICC's coordinator Emmet Helrich, a former cop. "You're [just] getting the ground rules. They're telling me, 'I wish I had more time.'"