I have an opportunity to do some contract work (non-government related) and have a question about per diem rates. I looked up the GSA website the per diem rate for the area and it shows $138/day. I have asked the company I would be contracting with and they indicate they pay $22/day per diem. Since $22/day wouldn't get you a camp site at the local KOA campgrounds I have a couple of questions:

1) Is this $22 amount just some token effort on their part and I'll have to pay the all the rest of my lodging expenses out of pocket and then claim it as an expense at tax time?

2) Do most companies hiring contractors pay a flat daily per diem rate at about that of the GSA rate or is a token amount like this normal?

Any additional insight into this area would be helpful.