Preheat your oven to 400°F. While it heats, wash and trim the asparagus, then cut into 2-inch pieces for easier serving. Lightly grease a 9x13 inch baking dish or similar casserole dish and spread the asparagus evenly in the bottom. Measure out all your spices (Italian seasoning, garlic powder, paprika, salt, pepper, and nutmeg) into a small bowl, and grate your parmesan cheese fresh—this makes a huge difference in how smoothly it melts into the sauce. Crumble your cooked bacon into roughly 1/2-inch bits and set aside. Have your cream cheese at room temperature; this prevents lumps from forming when you whisk it into the warm cream.
Melt the butter in a medium skillet over medium heat. Once melted, reduce heat to medium-low and whisk in the softened cream cheese until smooth and combined—this low-and-slow approach prevents the cheese from breaking. Pour in the cream and chicken broth, whisking constantly to create a smooth base. Add all your measured spices and continue whisking until fully incorporated, about 1-2 minutes. Let the sauce simmer gently for 3-4 minutes, stirring occasionally, until it begins to thicken slightly.
Remove the skillet from heat and stir in the parmesan and pepper jack cheese until completely melted and smooth. I find that removing from direct heat helps the cheese incorporate more evenly without any grainy texture. Taste the sauce and adjust seasoning if needed—remember the bacon will add saltiness later. Pour the entire sauce over the asparagus in the prepared baking dish, stirring gently to coat all the pieces evenly.
Bake the casserole uncovered for 15 minutes at 400°F until the sauce is bubbling around the edges and the asparagus is just beginning to soften. Remove from the oven and sprinkle the mozzarella evenly over the top, followed by the red pepper flakes. The red pepper flakes add a nice spicy kick and beautiful color contrast to the creamy dish.
Return the casserole to the oven for 3 more minutes until the mozzarella is melted and slightly golden. Remove from the oven and immediately top with the crumbled bacon from Step 1, distributing it evenly across the surface. The residual heat will warm the bacon slightly while keeping it crispy. Let rest for 2 minutes before serving.