Recently discovered traveling-wave solutions to the Navier-Stokes equations in plane shear geometries provide model flows for the study of turbulent drag reduction by polymer additives. These solutions, or "exact coherent states" (ECS), qualitatively capture the dominant structure of the near-wall buffer region of shear turbulence, i.e., counter-rotating pairs of streamwise-aligned vortices flanking a low-speed streak in the streamwise velocity. The optimum length scales for the ECS match well the length scales of the turbulent coherent structures and evidence suggests that the ECS underlie the dynamics of these structures. We study here the effect of viscoelasticity on these states. The changes to the velocity field for the viscoelastic ECS, where the FENE-P model calculates the polymer stress, mirror the modifications seen in experiments of fully turbulent flows of polymer solutions at low to moderate levels of drag reduction: drag is reduced, streamwise velocity fluctuations increase while wall-normal fluctuations decrease, and smaller wavelength structures are suppressed. These modifications to the ECS are due to the suppression of the streamwise vortices. The polymer molecules become highly stretched in the wavy, streamwise streaks, where the flow is predominately elongational, then relax as they move from the streaks into and around the streamwise vortices, where the flow is predominately rotational. This relaxation of the polymer molecules produces a force that directly opposes the fluid motion in the vortices, weakening them. Since the pressure fluctuations have their greatest magnitude (i.e., they are most negative) in the cores of the vortices, a reduction in vortex strength leads to a decrease in the magnitude of the pressure fluctuations. The pressure fluctuations redistribute energy from the streamwise velocity fluctuations to the Reynolds shear stress, so a decrease in their magnitude leads to a reduction in turbulent drag. For the viscoelastic ECS, we also find that after the onset of drag reduction (at Weissenberg number, WeϷ 7) there is a dramatic increase in the critical wall-normal length scale at which the ECS can exist. This sharp increase in length scale mirrors experimental observations and is also consistent with the observed shift to higher Reynolds numbers of the transition to turbulence in polymer solutions.