Basically, McCain's plan calls for taxing health benefits paid for by employers as if they were income for an employee. He offers up a tax credit to cover the costs but it's not even close to enough.
What Joe Klein doesn't mention, but the Center for American Progress does, is that this tax also a ticking bomb. And here's why: in many states, McCain's inadequate tax credit won't measure up to costs, even from day one. But it will get worse as time goes on, because although that tax credit grows year-to-year along with inflation, the costs of healthcare are rising much faster than that - ~%7/year, compared with ~%2/year for inflation. So every year, the McCain Health Tax is going to grow, and grow, and grow.
What does this mean for Virginia? Again, according to the Center for American Progress, by 2013 a family making $60,000/year will see a $1500 tax increase compared to current levels. There's a great interactive graphic on their site that lets you see what each state's tax hike will look like; pass it on to your friends!
How he can criticize Senator Obama's tax plan with a straight face, I'll never know.