By Jeff Zeleny, Senior Washington Correspondent

(CNN) -- President-elect Joe Biden on Thursday tapped Denis McDonough to lead the Department of Veterans Affairs, adding the longtime chief of staff to former President Barack Obama to his new Cabinet.

It's the latest example of how Biden is turning to a trusted set of advisers to surround him in his new administration. Also on Thursday morning, he said Susan Rice will lead the Domestic Policy Council in the new administration.

As VA secretary, McDonough would be inheriting one of the most challenging agencies in the government, so Biden was looking "for a seasoned hand, who knows the government well," a person familiar with the decision says.

Several veterans groups were hoping Biden would choose a veteran of the Iraq or Afghanistan wars. McDonough did not serve in the military, but rather has long experience navigating bureaucracies on Capitol Hill and at the White House.

McDonough, a native of Minnesota who served as chief of staff during Obama's entire second term, also worked as deputy national security adviser. He developed a close relationship with Biden during both positions. He is a devout Catholic, a bond he also shares with Biden.

McDonough could join other prospective Cabinet nominees on Friday in Wilmington, Delaware, but timing is still being worked out.

Politico was first to report the McDonough selection.

Prior to his role as White House chief of staff, McDonough served as assistant to the president and principal deputy national security adviser from September 2010 until February 2013. He also chaired the National Security Council's Deputies Committee, which is responsible for formulating the administration's national security and foreign policy.

McDonough also previously served as the chief of staff of the national security staff and as the deputy national security adviser for strategic communications. He was a senior foreign policy adviser during Obama's 2008 presidential campaign and then on the transition team.

McDonough served as a top staffer on Capitol Hill before working in the Obama White House, including as a foreign policy adviser for then-Senate Democratic Leader Tom Daschle.

Since leaving the White House, McDonough has joined the Markle Foundation, which aims to create a labor market that allows all Americans to succeed in the digital economy, as a senior adviser.