Preheat oven to 350F.
Line two baking sheets with parchment paper or silicone baking sheets.
In a large bowl, beat the butter and sugar until light and creamy, about 2 minutes. Beat in vanilla extract and then slowly beat in the flour until just incorporated.
Fold the dough out onto a floured surface. Place a piece of parchment paper over the dough and roll out until 1/4" thickness.
Use a round cookie cutter and cut out 40 cookies, re-rolling the dough as needed.
Place the cut cookies on the prepared baking sheets, about 1" apart.
Bake for 12-15 minutes until lightly golden brown.
Allow the cookies to cool as you prepare the caramel topping.
In a small bowl, combine 1/2 cup of caramels and 2 Tablespoons milk and microwave for 20 seconds. Stir and reheat as needed.
Portion out the caramel in 1 Tablespoon increments onto each cooled cookie.
(Repeat melting the caramels with milk as needed to top each cookie. I prefer to do this in small increments as the caramel tends to harden quickly.)
Once all shortbread cookies are topped with caramel, place the chocolate chips in a small bowl and microwave for 20 seconds. Stir and reheat as needed.
Drizzle the chocolate over the caramel-topped cookies.
Allow the chocolate to set completely before serving or storing.