UPDATE 1-Aetna, UnitedHealth win defense contracts

* Aetna contract $2.8 bln; total potential $16.7 bln

* UnitedHealth $3.7 bln; total potential $21.8 bln

* TriWest retained contract for western region

NEW YORK, July 13 (Reuters) - Aetna Inc (AET.N) and UnitedHealth Group Inc (UNH.N) won multibillion dollar contracts on Monday to provide services under a U.S. defense department's health care plan for soldiers and their families.

Aetna was awarded a $2.8 billion managed care contract with five one-year options for a total potential value of $16.7 billion for the department's TRICARE program.

The contract is for the northern region of the United States, according to the department's website.

The company could generate gross revenue of about $1.1 billion over the five-year agreement, an Aetna spokesman said.

UnitedHealth got a $3.7 billion managed care contract with five one-year options for a total potential value of $21.8 billion. The contract is for the southern region.

Not-for-profit TriWest Healthcare Alliance retained its contract for the western region. It got a $2.9 billion contract with five one-year options for total potential value of $17 billion.

TRICARE administers the health care plan for 9.4 million members of the military, retirees and their families worldwide. The contractors provide health, medical and administrative support services. (For more M&A news and our DealZone blog, go to www.reuters.com/deals) (Editing by Phil Berlowitz)