Middle-domain mobility management provides an efficient routing, low registration cost and handoff latency for layer 3 (IP layer) 802.16-based mobile network environment. In the middle-domain, the 802.16 base station (BS) acts as an agent or proxy to manage mobile networks to achieve this goal. The BS could only address external traffic but without internal case management. In order to complement this defect, an enhanced version for the middle-domain mobility management is designed in this paper. Moreover, we research and design the multicast extension for the middle-domain by applying the idea of the enhancement, which is called HMP (Hierarchical Multicast Protocol). Associated handoff scheme is also proposed in this paper. Since it is a complicated case for designing the multicast service in 802.16 network environment, we need a characteristic method to address this case. In order to fulfill this achievement of designing HMP scheme, we introduce a reduction process (RP) in this paper. By using the RP, a complicated 802.16-based network environment can be actually reduced to a simpler network environment. The mathematical analysis and simulation study are presented for performance evaluation. Simulation results have demonstrated that the enhanced middle-domain mobility management has the better network performance in terms of registration cost, handoff latency and routing cost in comparing with conventional mobility management schemes. Moreover, the proposed multicast extension for HMP scheme is simple and has scalability and network performance advantages over other approaches in mobile multicasting.