Hi hoodat; No you do not pull out the old paper it breaks down into injestable food filled with microbes that the worms suck up. As the worms work through(eat and digest) all the material you put in the bin, it, the material will become castings mixed with the unprocessed material and some will become very small particals and settle toward the bottom of the bin. when you have a few inches of this well processed material you remove it and place the unprocessed material back in the bin and add new bedding material paper,cardboard.coir or what ever you want to use for bedding and start the process over. You may have to devide the worms when the squirm (biomass) exceeds the bins size say 2lbs per sq foot of surface.

By Jove I think he's got it. Thanks.