By Caroline Humer and Diane Bartz

NEW YORK/WASHINGTON (Reuters) - Aetna Inc <AET.N> executives met with top Justice Department antitrust officials on Friday to convince the government that asset sales it proposed would address potential competitive problems that could threaten its deal to buy rival Humana Inc <HUM.N>, according to a source familiar with the matter.

Aetna's plan to buy Humana would combine two of the largest providers of Medicare Advantage plans for elderly people, and investors are concerned that antitrust regulators could oppose the deal.

The Justice Department's Antitrust Division is assessing both Aetna's $34 billion merger as well as Anthem's <ANTM.N> $44 billion deal to buy rival Cigna <CI.N>. The two mergers, if they close, would reduce the number of big, national health insurance companies from five to three.

In the meeting on Friday, Aetna argued that asset sales it was proposing would fix any potential competition problems that the deal creates, the source said, adding that major players were interested in acquiring them. The source did not specify which assets were on the chopping block. Reuters reported last week that Aetna had begun the process of auctioning off about $1 billion of Medicare Advantage assets to address antitrust concerns.

Before the meeting, the Justice Department had significant concerns about the deal, Reuters reported on Thursday. It was not known if antitrust enforcers planned to file a complaint to stop the deal or would accept the divestiture package and allow the deal to go forward.

In the review, antitrust regulators are focused on whether the deal would limit consumer choices for Medicare Advantage health plans for the elderly, a separate source familiar with the matter said.

Aetna has argued that Medicare Advantage competes not just with other Medicare Advantage plans but with traditional Medicare, which is managed by the government with data showing consumers switch between them. The Justice Department has previously disagreed with that approach, according to antitrust experts.

Consumers Union, Consumer Federation of America, Consumer Action, Families USA, U.S. PIRG, and Consumer Watchdog issued a white paper on Thursday which argued that divestitures could not counter the harm done by the two massive mergers, at least partially because it would be contracts rather than solid assets that are divested.

"In the next open season, it is all too easy for the merged firm to solicit and secure former policyholders, thus recreating the original conditions and eviscerating the remedy," the groups said.

Aetna has said that the acquisition will help it achieve scale that can drive down medical costs as well as provide better value-based care for consumers. That has become increasingly important because of President Barack Obama's national healthcare reform law, which has focused on cutting health costs.

(Editing by Bernard Orr)