Place potatoes in a saucepan fitted with a steamer basket and cook, covered, over simmering water until tender, 9 minutes.
Heat oil in a large nonstick skillet over medium heat. Add kielbasa and cook. Add potatoes and saute, stirring occasionally, until browned and tender, 5 to 7 minutes.
Sprinkle paprika, Italian seasoning or herb blend, garlic powder, salt and pepper to taste over potato-and-kielbasa mixture; stir to coat. Stir in spinach. Drizzle water into skillet, sprinkle cheddar over mixture, cover and cook until cheese is melted, about 2 minutes.
