[BUG] Insert At-Mentioned doesn't work anymore in VSCode Version: 1.108.0

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

When i select lines in VScode editor window and press Cmd + Option + K (MacOS), it doesn't trigger Insert At-Mentioned command even though my Claude Code inline chat opens on the right side bar. It worked yesterday.
I even tried Cmd + Shift + P -> Claude Code: Insert @-Mentioned Reference, it still didn't work. Seems that there's some conflict with the latest VSCode version.
Vscode version:
Version: 1.108.0
Commit: 94e8ae2b28cb5cc932b86e1070569c4463565c37
Date: 2026-01-08T13:53:10.781Z
Electron: 39.2.7
ElectronBuildId: 12953945
Chromium: 142.0.7444.235
Node.js: 22.21.1
V8: 14.2.231.21-electron.0
OS: Darwin arm64 25.0.0

MacOS: 26.0.1

What Should Happen?

Claude Code should trigger Insert At-Mentioned properly

Error Messages/Logs

Steps to Reproduce

1. Open Claude Code inline chat in the right side bar
2. Select a few lines in editor window
3. Press Cmd + Option + K
4. Actual: It doesn't trigger Insert At-Mentioned
5. Expected: Lines are selected to Claude inline chat

Claude Model

None

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

2.1.7 (Claude Code)

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Terminal.app (macOS)

Additional Information

_No response_