Today I licked 3 Moldy Boards, which instantly gave me 2 madness levels. (I had no madness prior to licking.) I quit the game without using any madness-lowering methods, just slept in a leafy bed (without Teddy Bear) on my claim. It was a short nap, 1-1.5 hours, but when I got back to the game, the madness was gone.
Not that I'm bothered by this, but still, as far as I know, it isn't meant to work like this...
WOW! Just as I'm logged in and writing this post, I got my madness back... Traveled to Providence, then after spending about 3-5 minutes there, my madness level refreshed. Then it is just a display bug.