How do you debug with the Ruby Test Explorer extension for VS Code?

I'm using VSCode 1.59 on Mac. I have a Ruby on Rails test project (Ruby v 3.0.1) and installed the "Ruby Test Explorer" extension -- https://marketplace.visualstudio.com/items?itemName=connorshea.vscode-ruby-test-adapter to help me run and debug tests. When I open a test file, I do see "Run," "Debug," and "Show In Test Explorer" items above each test. When I click on "Run" it does run the test ...

but when I click "Debug", it just hangs, never going to the breakpoint ...

Also, usually VSCode will popup a little Debug command palette with Step Over, Into, and Out commands but I don't see that. I'm not quite sure what else I need to do or configure. This is a simple project and the Gemfile is below

source 'https://rubygems.org'
git_source(:github) { |repo| "https://github.com/#{repo}.git" }

ruby '3.0.1'

gem 'rspec-core'
gem 'ruby-debug-ide'
gem 'debase'
gem 'rexml'
# Bundle edge Rails instead: gem 'rails', github: 'rails/rails', branch: 'main'
gem 'rails', '~> 6.1.3', '>= 6.1.3.1'
# Use sqlite3 as the database for Active Record
gem 'sqlite3', '~> 1.4'
# Use Puma as the app server
gem 'puma', '~> 5.0'
# Use SCSS for stylesheets
gem 'sass-rails', '>= 6'
# Transpile app-like JavaScript. Read more: https://github.com/rails/webpacker
gem 'webpacker', '~> 5.0'
# Turbolinks makes navigating your web application faster. Read more: https://github.com/turbolinks/turbolinks
gem 'turbolinks', '~> 5'
# Build JSON APIs with ease. Read more: https://github.com/rails/jbuilder
gem 'jbuilder', '~> 2.7'
# Use Redis adapter to run Action Cable in production
# gem 'redis', '~> 4.0'
# Use Active Model has_secure_password
# gem 'bcrypt', '~> 3.1.7'

# Use Active Storage variant
# gem 'image_processing', '~> 1.2'

# Reduces boot times through caching; required in config/boot.rb
gem 'bootsnap', '>= 1.4.4', require: false

group :development, :test do
  # Call 'byebug' anywhere in the code to stop execution and get a debugger console
  gem 'byebug', platforms: [:mri, :mingw, :x64_mingw]
end

group :development do
  # Access an interactive console on exception pages or by calling 'console' anywhere in the code.
  gem 'web-console', '>= 4.1.0'
  # Display performance information such as SQL time and flame graphs for each request in your browser.
  # Can be configured to work on production as well see: https://github.com/MiniProfiler/rack-mini-profiler/blob/master/README.md
  gem 'rack-mini-profiler', '~> 2.0'
  gem 'listen', '~> 3.3'
  # Spring speeds up development by keeping your application running in the background. Read more: https://github.com/rails/spring
  gem 'spring'
end

group :test do
  # Adds support for Capybara system testing and selenium driver
  gem 'capybara', '>= 3.26'
  gem 'selenium-webdriver'
  # Easy installation and use of web drivers to run system tests with browsers
  gem 'webdrivers'
end

# Windows does not include zoneinfo files, so bundle the tzinfo-data gem
gem 'tzinfo-data', platforms: [:mingw, :mswin, :x64_mingw, :jruby]
gem "rspec-rails", group: [:development, :test]