That depends on your backup policy, budget, risk tolerance, drive quality....
IMO, If you have 2 drives backing up the same data then I would use them until one showed signs of deterioration ( reallocated or uncorrectable sectors) or outright failure; you have the other one with a working backup plus the originals data files so your files are still 'safe'. Just make your 2nd backup copy asap.
If you only have 1 backup copy plus the originals then I would suggest a replacement policy similar to what you described but when you buy the replacement, keep this original backup drive as the 2nd backup and then just keep using it as described above.
If you only have 1 backup drive and no drive with the original files then this is not a good situation. One copy of files is not a backup. Get at least a second copy even if you must burn some dvd's. You never want to have important files in just 1 location/drive because sometimes they die with no warning or "life' happens (think fire, flood...); this is why it is recommended to keep the 2nd backup offsite.
I also would not wait a year between refreshing the drives. harddrives have bearing and sitting bearing might seize up. The longest I would suggest is 6 months.
Just my 2cents.