[BUG] File modifications not syncing between Claude Code terminal and VS Code editor, causing credit waste

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 Claude Code modifies files through the Edit tool, the changes are not properly synchronized with the VS Code editor, even though the file is marked as "modified (pending save)" in VS Code. This results in users paying credits for modifications that don't actually apply to their codebase.

What Should Happen?

File modifications made by Claude Code should be immediately visible in the VS Code editor and properly synchronized.

Error Messages/Logs

Steps to Reproduce

1. Open a file in VS Code with Claude Code extension
2. Ask Claude to modify the file using the Edit tool
3. Claude reports the modification was successful
4. Check the VS Code editor - the changes are not visible
5. File shows as modified (unsaved changes indicator)
6. Attempting to save triggers "file has been modified by another program" warning
7. Ask Claude to repeat the modification - same result
8. Credits are consumed for each failed attempt

Claude Model

Not sure / Multiple models

Is this a regression?

No, this never worked

Last Working Version

_No response_

Claude Code Version

1.0.119

Platform

Anthropic API

Operating System

Windows

Terminal/Shell

VS Code integrated terminal

Additional Information

Actual Behavior

• Claude Code reports successful modifications
• Changes are not visible in VS Code editor
• File shows as modified but content remains unchanged
• Multiple attempts waste user credits
• No error messages indicating sync failure

Environment

• VS Code with official Claude extension
• Platform: Windows (win32)
• Working with WordPress PHP files
• Git repository context

Impact

• Users pay credits for ineffective operations
• Workflow disruption requiring multiple attempts
• Loss of confidence in tool reliability
• Potential data inconsistency between terminal and editor state