1Melt butter in 10-inch nonstick skillet over medium heat. Sprinkle chicken with salt and pepper. Cook chicken in butter 15 to 20 minutes, turning once, until juice is no longer pink when centers of thickest pieces are cut. Remove chicken from skillet; keep warm.
2Mix water and gravy mix (dry) in small bowl; pour into same skillet. Stir in frozen vegetables and mushrooms. Heat to boiling; reduce heat. Simmer uncovered about 5 minutes, stirring occasionally, until largest pieces of potatoes are hot. Add chicken; cover and simmer about 2 minutes or until chicken is heated through.
3Serve vegetable and gravy mixture over chicken. Sprinkle with chives.