Hi-5 is a proposed L' band high-contrast nulling interferometric instrument for the visitor focus of the Very Large Telescope Interferometer (VLTI). As a part of the ERC consolidator project called SCIFY (Self-Calibrated Interferometry For exoplanet spectroscopY), the instrument aims to achieve sufficient dynamic range and angular resolution to directly image and characterize the snow line of young extra-solar planetary systems. The spectrometer is based on a dispersive grism and is located downstream of an integrated optics beam-combiner. To reach the contrast and sensitivity specifications, the outputs of the I/O chip must be sufficiently separated and properly sampled on the Hawaii-2RG detector. This has many implications for the photonic chip and spectrometer design. We present these technical requirements, trade-off studies, and phase-A of the optical design of the Hi-5 spectrometer in this paper. For both science and contract-driven reasons, the instrument design currently features three different spectroscopic modes (R=20, 400, and 2000). Designs and efficiency estimates for the grisms are also presented as well as the strategy to separate the two polarization states.