BROWN meat in large skillet; drain.
ADD water and ketchup; mix well. Bring to boil. Stir in macaroni; cover. Simmer on medium-low heat 8 to 10 min. or until macaroni is tender, stirring occasionally.
STIR in Velveeta; cook and stir 3 min. or until Velveeta is completely melted and mixture is well blended.