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Caramel-Swirl Hot Chocolate

['5 cups water', '5 3-ounce bars milk chocolate, chopped', '1/4 cup plus 1 cup chilled whipping cream', '1 tablespoon powdered sugar', '3 tablespoons prepared caramel sauce']

Bring 5 cups water and chocolate to simmer in medium saucepan, stirring to dissolve chocolate. Mix in 1/4 cup cream. (Can be prepared 1 day ahead. Cover and refrigerate. Bring to simmer, stirring frequently, before continuing.)
Whip 1 cup cream and powdered sugar in medium bowl until peaks form. Drizzle caramel over and swirl together, forming streaks (do not overmix).
Divide hot chocolate among 6 mugs. Top with generous amount of caramel whipped cream and serve.

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