[BUG] VSCode plugin doesn't remain authenticated across chats

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?

With the latest version of the Claude Code extension for VSCode, authentication is weird. Not only does attempting to authenticate not always work correctly, but once authenticated, if you try to create a new chat, the authentication goes away entirely. This ends up still being the case if you close VSCode and open a new window. It appears as though authentication only works for the initial chat.

What Should Happen?

Ideally, you should only need to authenticate once, and that authentication should persist across chats and across new instances of VSCode.

Error Messages/Logs

There don't appear to be any errors.

Steps to Reproduce

1. Update the Claude Code extension to the latest version.
2. Run the /login command.
3. Log in using your Claude.ai subscription.
4. Once you get sent back to the main chat area, send a message.
5. Run the "New Conversation" command or press the plus button in the top right-hand corner to start a new chat.
6. Attempt to send another message or even view any local slash commands that are available, and it shouldn't work.

Restarting VSCode does not help.

Claude Model

Sonnet (default)

Is this a regression?

I don't know

Last Working Version

_No response_

Claude Code Version

2.0.0

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

VS Code integrated terminal

Additional Information

Technically the "Terminal/Shell" option selected above is incorrect since the new extension doesn't use a terminal anymore, but is a native chat implementation.