It's much like painting on several thin layers of transparent plastic or glass instead of a sheet of paper. You can alter each one individually but together it still all makes one image. Draw your character, place a layer under that layer, then painting the background is as simple as scribbling all over the place because you can't interfere with the layer housing your character.
Here's a old one of mine. Belinda.
Here's a layer that makes up the eyes.
What you're seeing are two layers. One is transparent except for what's painted. The other is a solid white background. What's painted, at one point, was several transparent layers but now merged into one.
You see how Belinda's hair is ripply and gets darker on the sides? The hair was all one color, starting from the middle. I added a layer on top, probably used black spray paint and slowly worked my way out to the edges. Less shading in the middle, more out to the edges. Darker areas to create the illusions of ripples. You can even set the opacity of each layer to fine tune further.