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UPDATE 1-Humana looks to sell urgent care subsidiary Concentra -sources

(Adds Humana share price, background, bylines)

Oct 22 (Reuters) - Health insurer Humana Inc is exploring a sale of its urgent care subsidiary Concentra in a deal that could value it at around $1 billion, according to three people familiar with the matter.

The effort to sell Concentra comes less than four years after the unit was acquired. It indicates that Humana, one of the largest providers of Medicare plans for the elderly in the United States, has faced challenges in trying to run healthcare centers itself in order to better manage medical costs.

Humana has hired investment bank Goldman Sachs Group Inc to advise on the sale process, the people said on Wednesday, declining to be named because the matter is not public. Humana, based in Louisville, Kentucky, could not be reached for comment. Goldman Sachs declined to comment.

Humana shares were down 1.5 percent at $131.3 in afternoon trading in New York.

Concentra provides occupational medicine, urgent care, physical therapy and wellness services from more than 300 medical centers in 38 states, and also operates more than 245 workplace medical facilities, according to its website.

Humana, which has a market capitalization of more than $20 billion, acquired Concentra for $790 million in 2010 from private equity firm Welsh, Carson, Anderson & Stowe, which had taken it private in 1999 for $1.1 billion.

Last year, Humana sold Concentra’s toxicology and clinical laboratory business to Quest Diagnostics Inc for an undisclosed amount.

“What we are trying to do with that Concentra asset is to shift its focus more towards primary care as opposed to workers’ compensation and occupational medicine,” Humana’s chief operating officer, James Murray, told analysts on the company’s second-quarter earnings call in July.

“(Concentra’s) base business is performing well, but again, it’s a small component of our overall results as a company,” Murray said.

Humana’s chief executive, Bruce Broussard, told investors last month that the company was reviewing strategic alternatives for its pharmacy benefit management business. (Reporting by Soyoung Kim in Seoul and Olivia Oran and Greg Roumeliotis in New York; Editing by Meredith Mazzilli)