I’ve raised a bug request with the compose team for this https://issuetracker.google.com/issues/363189652

As a workaround you can add Scroll to last item with a delay

import androidx.compose.foundation.layout.Arrangement
import androidx.compose.foundation.layout.Box
import androidx.compose.foundation.layout.Column
import androidx.compose.foundation.layout.Row
import androidx.compose.foundation.layout.fillMaxSize
import androidx.compose.foundation.layout.fillMaxWidth
import androidx.compose.foundation.layout.height
import androidx.compose.foundation.layout.padding
import androidx.compose.foundation.lazy.LazyColumn
import androidx.compose.foundation.lazy.LazyListState
import androidx.compose.foundation.lazy.items
import androidx.compose.foundation.lazy.rememberLazyListState
import androidx.compose.foundation.text.BasicTextField
import androidx.compose.foundation.text.KeyboardActions
import androidx.compose.foundation.text.KeyboardOptions
import androidx.compose.material3.Surface
import androidx.compose.material3.Text
import androidx.compose.runtime.Composable
import androidx.compose.runtime.collectAsState
import androidx.compose.runtime.getValue
import androidx.compose.runtime.mutableStateOf
import androidx.compose.runtime.remember
import androidx.compose.runtime.rememberCoroutineScope
import androidx.compose.runtime.saveable.rememberSaveable
import androidx.compose.runtime.setValue
import androidx.compose.ui.Alignment
import androidx.compose.ui.Modifier
import androidx.compose.ui.graphics.Color
import androidx.compose.ui.text.input.ImeAction
import androidx.compose.ui.text.input.KeyboardType
import androidx.compose.ui.text.input.TextFieldValue
import androidx.compose.ui.unit.dp
import androidx.compose.ui.unit.sp
import androidx.hilt.navigation.compose.hiltViewModel
import androidx.lifecycle.ViewModel
import androidx.lifecycle.viewModelScope
import dagger.hilt.android.lifecycle.HiltViewModel
import kotlinx.coroutines.delay
import kotlinx.coroutines.flow.Flow
import kotlinx.coroutines.flow.MutableStateFlow
import kotlinx.coroutines.flow.SharingStarted
import kotlinx.coroutines.flow.StateFlow
import kotlinx.coroutines.flow.map
import kotlinx.coroutines.flow.stateIn
import kotlinx.coroutines.launch
import javax.inject.Inject

// setting this to 1 above our initial values
private const val INIT_ID = 8

@Composable
fun ChatBugDevScreen(
    viewModel: ChatBugViewModel = hiltViewModel(),
) {

    // we are using a unique key for id, so this should not cause an issue
    var currentId by remember { mutableStateOf(INIT_ID) }
    // scrollState is included here simply incase it is part of the solution
    val scrollState = rememberLazyListState()

    val scope = rememberCoroutineScope()

    val uiState: ChatBugUiState by viewModel.uiState.collectAsState()

    when (uiState) {
        ChatBugUiState.Initial -> {
            Column {
            }
        }

        is ChatBugUiState.Success -> {

            Column(Modifier.fillMaxSize()) {
                ChatBugMessages(
                    (uiState as ChatBugUiState.Success).data,
                    modifier = Modifier.weight(1f),
                    scrollState = scrollState,
                )

                ChatBugInput(
                    onMessageSent = { content ->
                        currentId += 1
                        viewModel.addMessage(ChatBugMessage(currentId, content))

                        scope.launch {
                            
                            // HACK, you need the delay here otherwise it still does not show the last item
                            delay(20)
                            scrollState.scrollToItem(0)
                        }

                    }
                )
            }
        }
    }
}

@Composable
private fun ChatBugMessages(
    messages: List<ChatBugMessage>,
    scrollState: LazyListState,
    modifier: Modifier = Modifier
) {

    // sorting the list in decending order, to work with reverseLayout
    val sortedMessages = messages.sortedByDescending { it.id }

    Box(modifier = modifier) {
        LazyColumn(reverseLayout = true,
            state = scrollState,
            modifier = Modifier
                .fillMaxSize()
        ) {

            // ISSUE: If you use the items without the key, then the keyboard does not hide the last item
            //  if you use the items with a key the keyboard does hide the last item

            // items(sortedMessages) { message ->
            items(sortedMessages, key = { message -> message.id }) { message ->
                Row {
                    Text(
                        text = message.message,
                        fontSize = 40.sp,
                        color = Color.White
                    )
                }
            }
        }
    }
}

@Composable
private fun ChatBugInput(
    onMessageSent: (String) -> Unit,
    modifier: Modifier = Modifier,
) {

    var textState by rememberSaveable(stateSaver = TextFieldValue.Saver) {
        mutableStateOf(TextFieldValue())
    }

    Surface(tonalElevation = 2.dp) {
        Column(modifier = modifier) {
            Row(
                modifier = Modifier
                    .fillMaxWidth()
                    .height(64.dp),
                horizontalArrangement = Arrangement.End
            ) {
                Box(Modifier.fillMaxSize()) {
                    BasicTextField(
                        value = textState,
                        onValueChange = { textState = it },
                        modifier = modifier
                            .padding(start = 32.dp)
                            .align(Alignment.CenterStart),
                        keyboardOptions = KeyboardOptions(
                            keyboardType = KeyboardType.Text,
                            imeAction = ImeAction.Send
                        ),
                        keyboardActions = KeyboardActions {
                            if (textState.text.isNotBlank()) {
                                onMessageSent(textState.text)
                                textState = TextFieldValue()
                            }
                        },
                        maxLines = 1,
                    )
                }
            }

        }
    }
}

@HiltViewModel
class ChatBugViewModel
@Inject
constructor() : ViewModel() {

    // ISSUE: This issue only occurs when using a Flow
    private val _messagesFlow: MutableStateFlow<List<ChatBugMessage>> = MutableStateFlow(emptyList())
    private val messagesFlow: Flow<List<ChatBugMessage>> = _messagesFlow

    // if the code is the below then you do not get the hidden keyboard, however this does not have the functionality
    // of the flow
    // private val _messages: MutableList<ChatBugMessage> = initialMessages.toMutableStateList()
    // val messages: List<ChatBugMessage> = _messages

    val uiState: StateFlow<ChatBugUiState> = messagesFlow.map { messagesFlow ->
        ChatBugUiState.Success(messagesFlow)
    }
        .stateIn(
            scope = viewModelScope,
            started = SharingStarted.WhileSubscribed(),
            initialValue = ChatBugUiState.Initial,
        )

    init {

        val initialMessages = listOf(
            ChatBugMessage(1, "initial 1"),
            ChatBugMessage(2, "initial 2"),
            ChatBugMessage(3, "initial 3"),
            ChatBugMessage(4, "initial 4"),
            ChatBugMessage(5, "initial 5"),
            ChatBugMessage(6, "initial 6"),
            ChatBugMessage(7, "initial 7")
        )

        _messagesFlow.value = initialMessages + _messagesFlow.value
    }

    fun addMessage(msg: ChatBugMessage) {
        _messagesFlow.value = listOf(msg) + _messagesFlow.value
    }
}

data class ChatBugMessage(
    val id: Int,
    val message: String,
)

sealed interface ChatBugUiState {
    data object Initial : ChatBugUiState
    data class Success(val data: List<ChatBugMessage>) : ChatBugUiState
}