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MIX apples, 2/3 cup sugar, tapioca, cinnamon, nutmeg and water in large saucepan. Cook on medium heat, stirring constantly, until mixture comes to full boil. Pour into 2-quart baking dish. Sprinkle with raisins. Dot with 2 Tbsp. of the butter.
CUT remaining butter into flour, 2 Tbsp. sugar, baking powder and salt until mixture resembles coarse crumbs. Stir in milk until soft dough forms. Drop by tablespoonfuls onto hot apple mixture.
BAKE at 375°F for 30 minutes or until topping is golden. Serve warm.