Mobs not instantly despawning outside of 128 block radius

In the attached image I am in the Nether at Y = 341 which is 213 blocks away from the Bedrock ceiling. The instant despawn radius is 128 which is not working.

 

I have executed a command to verify that there are mobs loaded 

execute as @e run say I am alive and below the bedrock ceiling which is at Y = 128

Many mobs execute this command indicating they are not despawning. And when I use a tp command to one of them it takes me to the lava lake way below the bedrock ceiling.