01 - Preheat oven to 400°F. Lightly grease a 9 x 13-inch baking dish with cooking spray or a small amount of olive oil.
02 - Season both sides of chicken breasts with salt and black pepper. Heat olive oil in a large skillet over medium-high heat. Sear chicken for 3-4 minutes per side until golden brown. Chicken will finish cooking in the oven. Transfer seared chicken to a plate and set aside.
03 - In the same skillet, add chopped onion and sliced mushrooms. Sauté for 4-5 minutes until vegetables soften and mushrooms release their moisture.
04 - Add minced garlic to the skillet and cook for 1 minute until fragrant. Stir in chopped spinach and cook until just wilted, about 1-2 minutes.
05 - Reduce heat to low. Add softened cream cheese and heavy cream, stirring constantly until smooth and combined. Mix in grated Parmesan, half of the shredded mozzarella, Italian herbs, and nutmeg. Taste and adjust salt and pepper if needed. Remove from heat.
06 - Spread the spinach-mushroom sauce mixture evenly across the bottom of the prepared baking dish. Arrange seared chicken breasts on top of the vegetable mixture. Spoon a small amount of sauce over each chicken breast.
07 - Sprinkle the remaining shredded mozzarella cheese evenly over the top of the chicken breasts.
08 - Bake uncovered for 20-25 minutes until chicken is fully cooked (internal temperature reaches 165°F) and cheese is bubbly and lightly golden on top.
09 - Remove from oven and let casserole rest for 5 minutes before serving. Garnish with fresh chopped parsley if desired.