KMSI not working in onprem SFB with MA

Hi guys,

We have recently set up our on premise Skype for Business server to use Modern authentication via internal AD FS (2016) and authenticate in Azure AD. 

The problem is that does not matter what I choose at KMSI screen - I will always have to re-enter my credentials each time I login to Skype. 

AD FS has default config for ksmi : 

PS C:\Windows\system32> Get-AdfsProperties | fl ssolifetime,*kmsi*,device*,persis*

SsoLifetime : 480
KmsiLifetimeMins : 1440
KmsiEnabled : True
DeviceUsageWindowInDays : 14
PersistentSsoLifetimeMins : 129600
PersistentSsoEnabled : True
PersistentSsoCutoffTime : 1/1/0001 2:00:00 AM

Please advise.

Thanks.