Preheat the oven: Set to 375°F (190°C). Lightly grease a medium baking dish, or use an oven-safe skillet to keep it all in one pan.
Season the chicken: Pat dry and season both sides with salt, pepper, onion powder, and paprika.
Sear the chicken: Heat olive oil in a large skillet over medium-high. Sear chicken 3–4 minutes per side until golden.
It won’t be fully cooked yet. Transfer to a plate.
Sauté the mushrooms and onions: Reduce heat to medium. Add butter.
Sauté mushrooms and onion with a pinch of salt for 6–8 minutes, stirring occasionally, until browned and most liquid evaporates.
Add garlic and herbs: Stir in garlic, thyme, and red pepper flakes if using. Cook 30–60 seconds until fragrant.
Build the sauce: Pour in chicken broth (and a splash of wine if using). Simmer 2 minutes, scraping browned bits.
Stir in cream and cream cheese until smooth. Simmer gently 2–3 minutes to thicken slightly. Taste and season with salt and pepper.
Combine and top: Nestle chicken into the sauce.
Sprinkle Parmesan and then mozzarella evenly over the top.
Bake: Transfer to the oven and bake 15–20 minutes, or until the chicken reaches an internal temperature of 165°F (74°C) and the cheese is melted and bubbly.
Optional broil: For a golden top, broil 1–2 minutes. Watch closely to prevent burning.
Rest and serve: Let stand 5 minutes. Garnish with fresh parsley or thyme.
Serve with a simple side like roasted broccoli, sautéed spinach, or cauliflower rice.