Background: Telemedicine use expanded rapidly during the COVID-19 pandemic. The Hong Kong Hospital Authority (HA) launched both tele-designated clinics (Tele-DCs) and face-to-face physical designated clinics (PDCs) to manage mild cases. However, the comparative effectiveness of these models remains unclear. Objective: This study aimed to compare clinical outcomes, specifically hospitalization and severe complications, between patients with mild COVID-19 managed via Tele-DCs versus PDCs in Hong Kong’s public primary care setting. Methods: We conducted a retrospective cohort study involving all patients with COVID-19, aged 18 years or older, who visited a PDC (n=23,031) or a Tele-DC (n=38,628) at the Kowloon Central Cluster in Hong Kong from July 28, 2022, to January 29, 2023. Patients were matched 1:1 using propensity score matching based on age, sex, smoking status, comprehensive social security assistance (CSSA) status, and the Charlson comorbidity score, resulting in 17,199 patients per group. The primary outcome was the hospital admission rate between day 1 and day 28. Secondary outcomes included severe complications, mortality, accident and emergency department (AED) use, the antiviral prescription rate, and DC revisit. Results: The average age of patients in the Tele-DC and PDC groups was 58.55 (SD 17.53) and 58.53 (SD 17.54) years, respectively (P=.93). In both groups, 9.05% (n=1557) of patients were on CSSA, and 11% (n=1892) were smokers. Compared to the PDC group, the Tele-DC group demonstrated similar hospital admission rates (Tele-DC: n=497, 2.89%; PDC: n=471, 2.74%; between-group difference 0.15%, 95% CI –0.20% to 0.50%, P=.40), lengths of stay (Tele-DC: mean 6.92, SD 0.47 days; PDC: mean 6.61, SD 0.50 days; between-group difference 0.31 days, 95% CI –1.65 to 1.04, P=.66), severe complication rates (Tele-DC: n=46, 0.27%; PDC: n=33, 0.19%; between-group difference 0.08%, 95% CI –0.03% to 0.18%, P=.18), and mortality rates (Tele-DC: n=23, 0.13%; PDC: n=18, 0.10%; between-group difference 0.03%, 95% CI –0.04% to 0.10%, P=.39). However, the Tele-DC group exhibited a higher AED visit rate (n=641, 3.73%, vs n=542, 3.15%; between-group difference 0.58%, 95% CI 0.19%-0.96%, P.003) and DC revisit rate (n=1446, 8.41%, vs n=1287, 7.48%; between-group difference 0.93%, 95% CI 0.09%-1.50%, P.002). In addition, the Tele-DC group had a lower antiviral prescription rate (n=9872, 57.4%, vs n=10,797, 62.78%; between-group difference –5.38%, 95% CI –6.41% to –4.32%, P<.001). Conclusions: The tele-DC demonstrated clinical safety comparable to the PDC regarding hospitalization and severe complications for patients with mild COVID-19. By validating a scalable model without complex home monitoring, these findings challenge the strict necessity of physical examinations for safe triage and support a digital-first strategy for future infectious surges. However, the disparities observed in AED visits and antiviral prescription rates suggest that integrated remote monitoring tools and improved medication logistics are needed to fully replicate the efficacy of conventional care.