MELT butter in large skillet over medium heat. Add mushrooms, bell pepper and onion; cook, stirring occasionally, for 1 to 2 minutes or until tender but not brown. Stir in flour, salt and paprika. Gradually add evaporated milk. Cook over medium heat, stirring constantly, until mixture comes to a boil.
WHISK 1 cup thickened sauce into egg yolks; pour into saucepan. Cook over medium heat, stirring constantly, until mixture comes to a boil. Stir in chicken, pimiento and sherry. Heat through.
SERVE immediately over hot biscuits.