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