He does address it, but I find his argument to be extremely weak.
In section 1.1 The Causal Argument, the author writes:
"It’s wise for Direct Realists to concede that for humans, and for percipients physiologically like us in the actual world, perception involves a long and complex causal series of events, and that perception is indeed dependent upon the condition of the eyes, of the optic nerve, and of the brain, upon the nature of the intervening medium, and so on. One can be a Direct Realist without being so naïve or ignorant as to think that in the actual world (and relevantly similar possible worlds), humans perceive external objects or events directly in the sense that there are no causal intermediaries between the external object or event and the percipient. Does this concession entail the falsity of Direct Realism? No. In holding that external objects or events are immediate or direct objects of perception, Direct Realists deny that perception of these external objects or events must be mediated by a prior awareness of causal intermediaries in the causal series eventuating in perception. Even if, say, the photoisomerisation of rhodopsin photopigment molecules in one’s eyes is a nomically necessary intermediary event in one’s visual perception of external objects or events, it does not follow, on Direct Realism, that one must be aware of that event (or any 5 other intermediary event or object) when one perceives external physical objects or events.
In this light, consider the following two claims:
(i) perception is indirect in the sense that it involves a series of causal intermediaries between the external object (or event) and the percipient; and (ii) perception is indirect in the sense of involving a prior awareness of something other than the external object (or event).
Claims (i) and (ii) thus distinguished, Direct Realists can argue that it does not follow from the fact that perception is indirect in the sense of (i) that it is indirect in the sense of (ii). What the Causal Argument establishes is only the causal indirectness of perception in the sense of (i), not the cognitive indirectness in the sense of (ii). Hence, this argument does not refute Direct Realists not committed to denying the indirectness of perception in the sense of (i). Thus, lest they fall prey to this argument, Direct Realists should be careful to distinguish between causal indirectness and cognitive indirectness."
So right up front the author concedes that "perception is indirect in the sense that it involves a series of causal intermediaries between the external object (or event) and the percipient." (Personally, once one has conceded this, imho, referring to perception as "direct" is semantics.)
In any case, in section 1.6. The Argument from Hallucination, the author writes:
"Second, let’s suppose that the drunk and Macbeth are each immediately aware of something, and that no physical pink rats appear to the drunk and no physical dagger appears to Macbeth. But from (i) no physical pink rats appear to the drunk or no physical dagger appears to Macbeth, and (ii) the drunk and Macbeth are each immediately aware of something, we need not conclude that (iii) sense-data (or ideas or the like) are the objects of immediate awareness in cases of hallucination. For (iii) neither follows deductively from (i) and (ii), nor is it the only (viable) explanation of (i) and (ii). Direct Realists can account for (i) and (ii) without conjuring up such strange existents as sense data (or the like) in at least three ways. One account takes states of the brain to be the objects of immediate awareness in cases of hallucination.18 A second account takes the objects of awareness in cases of hallucination to be mental images.19 The third account, the one preferred by the author of this paper, takes physical space occupants to be the objects of immediate awareness in hallucination.20 All three accounts offer explanations of hallucination without conjuring up a whole other order of existents."
So the author says that a Direct Realist could hold that hallucinations are states of the brain.
My response would be that based on the previous concession--that "perception is indirect in the sense that it involves a series of [physiological] causal intermediaries between the external object (or event) and the percipient"--that the author has no grounds to argue that perceptions and hallucinations are ontologically distinguishable.
Because according to the author's own arguments, the only way to distinguish between a hallucination and a perception is to determine if there is a corresponding external event or not.
To clarify, the author agrees that (1) all "perception" involves physiological intermediaries between* the external event and the percipient, and (2) hallucinations could be physiological states. However, the author argues that we shouldn't assume hallucinations and perceptions are ontologically the same, but he hasn't given us any reason at all to believe that they are ontologically distinct.
To be honest, at the end of the day, I'm not sure what the author, a direct realist, is arguing for or against... He concedes that all perceptions involve intermediary physiological processes and that the phrase "direct" refers to "cognitive" directedness as opposed to causal directedness. As far as I'm concerned, this is an incredibly weak version of Direct Realism.
What's the difference, really, between this weak version of Direct Realism and versions of Indirect Realism?