I am going through a very similar situation with my husband. He was diagnosed bipolar in Feb. He is also having trouble doing anything productive. He is on sick leave from work, which will run out in 5 months.
He is also extremely paranoid. He doesn't think that he will die, he just thinks he is going to jail. When you ask him what crime he has committed, he can't really explain. He is very nervous and anxious and can not sit still. He is doing things in a repetitve manner (i.e. repeating quesitons, taking things out of his pockets, etc...) He's a smoker and has been forever, but he keeps burning his lips by putting the cigar in his mouth lit end first.
It's very hard to watch this happen. My husband is also on Xanax - although not as high a dose as your husband. We are weaning him off of Xanax because I have read that a side effect can be "extreme confusion". Another side effect is yellowing of the eyes. My husband has had this also, but we thought at the time it was due to the fact that he was dehydrated and was in the hospital being treated for it.
Unfortunately, I don't have any advice to offer you - just the knowledge that you aren't alone. If you ever want to compare stories or just vent together, I'll be here. I'm having a hard time going from wife/partner to care giver/almost mother. I miss my husband and miss having someone to talk too. Hopefully, the medications will kick in soon.
Lelore