When you have python code that is nested, ie: when you have functions inside of classes, collapsing the inner functions will 'collapse too far' with the next function/class/etc name ending up on the same line that you just collapsed.

Take for example the following class
class cls:
	def foo(self):
		pass
	def bar(self):
		pass

if you were to collapse foo, the editor collapses it like so:
class cls:
	def food(self):{...} def bar(self):
		pass