Preheat a smoker to 250°F. In a small bowl, mix the cream cheese, cheddar, and chopped jalapeños until evenly combined.
In a large bowl, combine the ground beef, egg, breadcrumbs, milk, garlic powder, smoked paprika, salt, and black pepper. Mix gently just until the ingredients come together.
Place the meat mixture on a sheet of parchment and press it into a rectangle about 1/2 inch thick. Spread the cream cheese mixture down the center, leaving a border around the edges.
Use the parchment to fold the meat over the filling and seal the edges. Shape it into a compact loaf, keeping the filling enclosed. Lay the bacon slices over the top and tuck their ends underneath.
Transfer the loaf to a smoker-safe pan or rack. Smoke until the center of the meat reaches 160°F on an instant-read thermometer, checking the temperature in the meat rather than the filling.
Let the meatloaf rest for 10 minutes before slicing. This helps the creamy center settle and makes the slices easier to serve.