[BUG] `ANTHROPIC_DEFAULT_*_MODEL` in `settings.json` silently stripped under Desktop's `PROVIDER_MANAGED_BY_HOST`

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?

Summary

When Claude Code runs inside Claude Desktop (CLAUDE_CODE_ENTRYPOINT=claude-desktop), any ANTHROPIC_DEFAULT_*_MODEL override set via ~/.claude/settings.json's env block is filtered out before reaching process.env. The built-in Explore subagent is pinned to model: "haiku", so it ends up running as the host-default Haiku 4.5 with no way to redirect it. There is no warning or log about the filter.

Environment

• Claude Code: 2.1.111 (bundled in Claude Desktop)
• Entry point: claude-desktop
• OS: macOS 15.1 (Darwin 24.1.0)

Reproduction

1. In ~/.claude/settings.json, set:

``json
{
"env": {
"CLAUDE_CODE_EXPERIMENTAL_AGENT_TEAMS": "1",
"ANTHROPIC_DEFAULT_HAIKU_MODEL": "claude-sonnet-4-6",
"ANTHROPIC_DEFAULT_SONNET_MODEL": "claude-sonnet-4-6"
}
}
``

1. Launch Claude Code via the Desktop app.
2. Spawn an Explore subagent (e.g. via the Agent tool, subagent_type: "Explore").
3. In the UI, the subagent is labeled "Haiku 4.5". In a Bash tool run, confirm:

``
CLAUDE_CODE_EXPERIMENTAL_AGENT_TEAMS=1 (propagated)
ANTHROPIC_DEFAULT_HAIKU_MODEL=<unset> (stripped)
ANTHROPIC_DEFAULT_SONNET_MODEL=<unset> (stripped)
CLAUDE_CODE_PROVIDER_MANAGED_BY_HOST=1 (set by host)
``

Expected

Either:

• The ANTHROPIC_DEFAULT_*_MODEL overrides in settings.json should take effect (the nGH() / vR() / bh() resolvers already read them correctly), or
• Claude Code should surface a clear warning/log when it drops a user-supplied env var because it's provider-managed, so users know why their setting silently doesn't work.

Actual

The override is silently dropped. Explore continues to run on the host-default Haiku.

Root cause

Two functions in the bundled JS are responsible (names are minified):

// Denylist of "provider-managed" env keys
o01 = new Set([
  "CLAUDE_CODE_PROVIDER_MANAGED_BY_HOST", "CLAUDE_CODE_USE_BEDROCK", ...,
  "ANTHROPIC_MODEL",
  "ANTHROPIC_DEFAULT_HAIKU_MODEL", "ANTHROPIC_DEFAULT_HAIKU_MODEL_NAME", ...,
  "ANTHROPIC_DEFAULT_SONNET_MODEL", ...,
  "ANTHROPIC_DEFAULT_OPUS_MODEL", ...,
  "ANTHROPIC_SMALL_FAST_MODEL", "CLAUDE_CODE_SUBAGENT_MODEL",
  ...
]);

function UC9(H) {
  let _ = H.toUpperCase();
  return o01.has(_) || a01.some((q) => _.startsWith(q));
}

function BC5(H) {
  if (!H) return {};
  if (!VH(process.env.CLAUDE_CODE_PROVIDER_MANAGED_BY_HOST)) return H; // no-op when host not managing
  let _ = {};
  for (let [q, K] of Object.entries(H))
    if (!UC9(q)) _[q] = K;
  return _;
}

BC5 is applied to the user's settings.json env block before it's merged into process.env. When the Desktop host sets CLAUDE_CODE_PROVIDER_MANAGED_BY_HOST=1, every key in o01 is dropped. CLAUDE_CODE_EXPERIMENTAL_AGENT_TEAMS is not in o01, which is why that same env block's other key DOES propagate — making the failure mode especially confusing.

Meanwhile the built-in Explore agent definition is:

{
  agentType: "Explore",
  source: "built-in",
  model: "haiku",
  ...
}

and the "haiku" → concrete-model resolver respects the env var when it's set:

function nGH() {
  if (process.env.ANTHROPIC_DEFAULT_HAIKU_MODEL)
    return process.env.ANTHROPIC_DEFAULT_HAIKU_MODEL;
  return M$()[tU];
}

So the override path would work end-to-end — it's only the upstream env-filter that breaks it.

Impact

• Users have no way to redirect the built-in Explore agent (or any agent pinned to "haiku" / "sonnet" / "opus") away from the host defaults when running under Desktop.
• Cost/latency surprise: users who assumed their override applied are getting a different model than they configured.
• Debugging is hard because the filter is silent and the env block partially works (keys not in o01 still propagate).

Suggested fixes (pick one or more)

1. Honor ANTHROPIC_DEFAULT_*_MODEL from settings.json even under PROVIDER_MANAGED_BY_HOST. The host only needs to manage auth/endpoint/account-level model gating; the alias → concrete-model mapping is a UX preference.
2. If keeping the filter, emit a warning to the status line / debug log when BC5 drops a user-supplied key, e.g. "Ignored settings.json env var ANTHROPIC_DEFAULT_HAIKU_MODEL: managed by host".
3. Document the denylist in the settings.json docs so users don't waste time configuring vars that won't take effect.
4. Optionally, expose a models block in settings.json (e.g. "models": { "haiku": "claude-sonnet-4-6" }) that takes a different code path and isn't env-filtered.

Workarounds today

• Launch claude from a terminal instead of Desktop — CLAUDE_CODE_PROVIDER_MANAGED_BY_HOST isn't set, so BC5 becomes a pass-through.
• Pass model explicitly on every Agent(...) call (doesn't help with built-in Explore's default).

Related issues

Not a duplicate of any of these, but they share adjacent ground:

• #41533 — Same code path: Desktop's PROVIDER_MANAGED_BY_HOST filter strips CLAUDE_CODE_USE_FOUNDRY from settings.json, breaking Azure Foundry routing. Different user-facing symptom (provider routing vs. alias resolution), same underlying BC5/UC9/o01 mechanism.
• #49925 — Same code path in Desktop SSH mode: the host injects PROVIDER_MANAGED_BY_HOST=1 on the remote and strips its Vertex/Bedrock config. SSH-specific manifestation of the same filter behavior.
• #48365 — Reports the opposite behavior on Windows: ANTHROPIC_DEFAULT_HAIKU_MODEL from settings.json is injected in Desktop OAuth mode (and used by WebFetch), while ANTHROPIC_BASE_URL is not. Either the env filter is platform-gated (macOS strips, Windows doesn't?), version-gated (Windows reporter was on 2.1.109; this report on 2.1.111), or one of the observations is flawed. Would appreciate an Anthropic engineer clarifying the intended behavior across platforms/versions.
• #47488 — Similar end-user symptom (subagents silently forced to Haiku) but different mechanism: in Cowork on Windows, the Electron host unconditionally injects CLAUDE_CODE_SUBAGENT_MODEL=claude-haiku-4-5-20251001, overriding the Agent tool's model: parameter. Not the env-filter path; a spawn-site injection. Still a silent model override without any surfaced warning.
• #43869 — CLI-side: every documented subagent model override mechanism (model: param, frontmatter, CLAUDE_CODE_SUBAGENT_MODEL env var, settings.json env block) silently resolves to the parent's model. Different root cause, but part of the same "subagent model routing is broken somewhere in the stack" pattern.

What Should Happen?

Either:

• The ANTHROPIC_DEFAULT_*_MODEL overrides in settings.json should take effect (the nGH() / vR() / bh() resolvers already read them correctly), or
• Claude Code should surface a clear warning/log when it drops a user-supplied env var because it's provider-managed, so users know why their setting silently doesn't work.

Error Messages/Logs

Steps to Reproduce

1. In ~/.claude/settings.json, set:

``json
{
"env": {
"CLAUDE_CODE_EXPERIMENTAL_AGENT_TEAMS": "1",
"ANTHROPIC_DEFAULT_HAIKU_MODEL": "claude-sonnet-4-6",
"ANTHROPIC_DEFAULT_SONNET_MODEL": "claude-sonnet-4-6"
}
}
``

1. Launch Claude Code via the Desktop app.
2. Spawn an Explore subagent (e.g. via the Agent tool, subagent_type: "Explore").
3. In the UI, the subagent is labeled "Haiku 4.5". In a Bash tool run, confirm:

``
CLAUDE_CODE_EXPERIMENTAL_AGENT_TEAMS=1 (propagated)
ANTHROPIC_DEFAULT_HAIKU_MODEL=<unset> (stripped)
ANTHROPIC_DEFAULT_SONNET_MODEL=<unset> (stripped)
CLAUDE_CODE_PROVIDER_MANAGED_BY_HOST=1 (set by host)
``

Claude Model

None

Is this a regression?

I don't know

Last Working Version

_No response_

Claude Code Version

2.1.112

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Other

Additional Information

_No response_