In a shallow dish, combine flour, paprika, garlic powder, onion powder, salt, and pepper. Dredge each chicken breast in the flour mixture, shaking off any excess.
Heat olive oil in a large oven-safe skillet over medium-high heat. Add the chicken breasts and cook for about 5 minutes on each side, until golden brown. Remove the chicken from the skillet and set aside.
In the same skillet, add butter and let it melt. Stir in the sliced onions and sauté until translucent, about 3-4 minutes. Add minced garlic and thyme, cooking for another minute until fragrant.
Pour in chicken broth and milk, stirring to combine. Bring the mixture to a simmer and return the chicken breasts to the skillet, spooning some of the sauce over the chicken.
Transfer the skillet to the preheated oven and bake for 25-30 minutes, or until the chicken is cooked through and the sauce has thickened.
Garnish with fresh parsley before serving, and enjoy your smothered chicken with loved ones.